ARCHROCK INC (AROC) Stock Fundamental Analysis
USA - NYSE:AROC - US03957W1062 - Common Stock
24.25 USD
+0.49 (+2.06%)
24.25 USD
0 (0%)
Taking everything into account, AROC scores 6 out of 10 in our fundamental rating. AROC was compared to 61 industry peers in the Energy Equipment & Services industry. While AROC belongs to the best of the industry regarding profitability, there are concerns on its financial health. AROC is not priced too expensively while it is growing strongly. Keep and eye on this one! AROC also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
In the past year AROC was profitable.
AROC had a positive operating cash flow in the past year.
AROC had positive earnings in 4 of the past 5 years.
AROC had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of AROC (5.16%) is better than 65.57% of its industry peers.
AROC has a better Return On Equity (16.23%) than 80.33% of its industry peers.
AROC's Return On Invested Capital of 8.26% is fine compared to the rest of the industry. AROC outperforms 68.85% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AROC is in line with the industry average of 8.04%.
The last Return On Invested Capital (8.26%) for AROC is above the 3 year average (6.45%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.16% | ||
| ROE | 16.23% | ||
| ROIC | 8.26% |
ROA(3y)3.33%
ROA(5y)1.7%
ROE(3y)9.89%
ROE(5y)5.05%
ROIC(3y)6.45%
ROIC(5y)5.83%
1.3 Margins
AROC has a Profit Margin of 16.94%. This is amongst the best in the industry. AROC outperforms 93.44% of its industry peers.
In the last couple of years the Profit Margin of AROC has grown nicely.
AROC has a Operating Margin of 34.97%. This is amongst the best in the industry. AROC outperforms 98.36% of its industry peers.
In the last couple of years the Operating Margin of AROC has grown nicely.
AROC has a Gross Margin of 62.75%. This is amongst the best in the industry. AROC outperforms 96.72% of its industry peers.
AROC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.97% | ||
| PM (TTM) | 16.94% | ||
| GM | 62.75% |
OM growth 3Y20.43%
OM growth 5Y8.34%
PM growth 3Y61.88%
PM growth 5Y8.11%
GM growth 3Y3.75%
GM growth 5Y2.75%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), AROC is creating some value.
AROC has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, AROC has more shares outstanding
The debt/assets ratio for AROC has been reduced compared to a year ago.
2.2 Solvency
AROC has an Altman-Z score of 0.78. This is a bad value and indicates that AROC is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of AROC (0.78) is worse than 78.69% of its industry peers.
The Debt to FCF ratio of AROC is 156.20, which is on the high side as it means it would take AROC, 156.20 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of AROC (156.20) is worse than 70.49% of its industry peers.
A Debt/Equity ratio of 1.86 is on the high side and indicates that AROC has dependencies on debt financing.
The Debt to Equity ratio of AROC (1.86) is worse than 86.89% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.86 | ||
| Debt/FCF | 156.2 | ||
| Altman-Z | 0.78 |
ROIC/WACC1.01
WACC8.16%
2.3 Liquidity
AROC has a Current Ratio of 1.81. This is a normal value and indicates that AROC is financially healthy and should not expect problems in meeting its short term obligations.
AROC has a Current ratio (1.81) which is in line with its industry peers.
A Quick Ratio of 1.30 indicates that AROC should not have too much problems paying its short term obligations.
AROC has a worse Quick ratio (1.30) than 60.66% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.81 | ||
| Quick Ratio | 1.3 |
3. Growth
3.1 Past
AROC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 51.11%, which is quite impressive.
The Earnings Per Share has been growing slightly by 5.59% on average over the past years.
AROC shows a strong growth in Revenue. In the last year, the Revenue has grown by 28.22%.
Measured over the past years, AROC shows a small growth in Revenue. The Revenue has been growing by 3.70% on average per year.
EPS 1Y (TTM)51.11%
EPS 3Y76.8%
EPS 5Y5.59%
EPS Q2Q%69.57%
Revenue 1Y (TTM)28.22%
Revenue growth 3Y13.99%
Revenue growth 5Y3.7%
Sales Q2Q%41.63%
3.2 Future
AROC is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 22.50% yearly.
AROC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.95% yearly.
EPS Next Y51.54%
EPS Next 2Y33.35%
EPS Next 3Y27.4%
EPS Next 5Y22.5%
Revenue Next Year28.1%
Revenue Next 2Y16.78%
Revenue Next 3Y13.16%
Revenue Next 5Y10.95%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
AROC is valuated rather expensively with a Price/Earnings ratio of 17.83.
The rest of the industry has a similar Price/Earnings ratio as AROC.
When comparing the Price/Earnings ratio of AROC to the average of the S&P500 Index (27.40), we can say AROC is valued slightly cheaper.
AROC is valuated correctly with a Price/Forward Earnings ratio of 12.99.
Compared to the rest of the industry, the Price/Forward Earnings ratio of AROC indicates a somewhat cheap valuation: AROC is cheaper than 65.57% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.94. AROC is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.83 | ||
| Fwd PE | 12.99 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, AROC is valued expensively inside the industry as 83.61% of the companies are valued cheaper.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of AROC indicates a slightly more expensive valuation: AROC is more expensive than 68.85% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 254.87 | ||
| EV/EBITDA | 9.71 |
4.3 Compensation for Growth
AROC's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
AROC has an outstanding profitability rating, which may justify a higher PE ratio.
AROC's earnings are expected to grow with 27.40% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.35
PEG (5Y)3.19
EPS Next 2Y33.35%
EPS Next 3Y27.4%
5. Dividend
5.1 Amount
AROC has a Yearly Dividend Yield of 3.54%. Purely for dividend investing, there may be better candidates out there.
AROC's Dividend Yield is rather good when compared to the industry average which is at 3.22. AROC pays more dividend than 83.61% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.36, AROC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.54% |
5.2 History
The dividend of AROC has a limited annual growth rate of 3.62%.
AROC has been paying a dividend for at least 10 years, so it has a reliable track record.
AROC has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)3.62%
Div Incr Years2
Div Non Decr Years7
5.3 Sustainability
AROC pays out 55.29% of its income as dividend. This is a bit on the high side, but may be sustainable.
The dividend of AROC is growing, but earnings are growing more, so the dividend growth is sustainable.
DP55.29%
EPS Next 2Y33.35%
EPS Next 3Y27.4%
24.25
+0.49 (+2.06%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryEnergy Equipment & Services
Earnings (Last)
Earnings (Next)
Inst Owners95.74%
Inst Owner Change0.02%
Ins Owners2.71%
Ins Owner Change-0.07%
Market Cap4.26B
Analysts84
Price Target31.39 (29.44%)
Short Float %3.34%
Short Ratio3.54
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.54% |
Yearly Dividend0.67
Dividend Growth(5Y)3.62%
DP55.29%
Div Incr Years2
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.12%
Min EPS beat(2)3.25%
Max EPS beat(2)5%
EPS beat(4)3
Avg EPS beat(4)-0.16%
Min EPS beat(4)-19.32%
Max EPS beat(4)10.45%
EPS beat(8)5
Avg EPS beat(8)0.58%
EPS beat(12)8
Avg EPS beat(12)13.04%
EPS beat(16)9
Avg EPS beat(16)10.32%
Revenue beat(2)1
Avg Revenue beat(2)0.81%
Min Revenue beat(2)-0.71%
Max Revenue beat(2)2.33%
Revenue beat(4)2
Avg Revenue beat(4)-0.37%
Min Revenue beat(4)-3.21%
Max Revenue beat(4)2.33%
Revenue beat(8)4
Avg Revenue beat(8)-0.46%
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-0.31%
PT rev (3m)-0.31%
EPS NQ rev (1m)0.2%
EPS NQ rev (3m)2.44%
EPS NY rev (1m)0.43%
EPS NY rev (3m)-0.13%
Revenue NQ rev (1m)0.13%
Revenue NQ rev (3m)-0.76%
Revenue NY rev (1m)0.07%
Revenue NY rev (3m)0.86%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.83 | ||
| Fwd PE | 12.99 | ||
| P/S | 3.16 | ||
| P/FCF | 254.87 | ||
| P/OCF | 9.18 | ||
| P/B | 3.03 | ||
| P/tB | 3.77 | ||
| EV/EBITDA | 9.71 |
EPS(TTM)1.36
EY5.61%
EPS(NY)1.87
Fwd EY7.7%
FCF(TTM)0.1
FCFY0.39%
OCF(TTM)2.64
OCFY10.89%
SpS7.67
BVpS8.01
TBVpS6.43
PEG (NY)0.35
PEG (5Y)3.19
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.16% | ||
| ROE | 16.23% | ||
| ROCE | 11.17% | ||
| ROIC | 8.26% | ||
| ROICexc | 8.27% | ||
| ROICexgc | 8.85% | ||
| OM | 34.97% | ||
| PM (TTM) | 16.94% | ||
| GM | 62.75% | ||
| FCFM | 1.24% |
ROA(3y)3.33%
ROA(5y)1.7%
ROE(3y)9.89%
ROE(5y)5.05%
ROIC(3y)6.45%
ROIC(5y)5.83%
ROICexc(3y)6.45%
ROICexc(5y)5.83%
ROICexgc(3y)6.61%
ROICexgc(5y)5.97%
ROCE(3y)8.72%
ROCE(5y)7.88%
ROICexcg growth 3Y21.54%
ROICexcg growth 5Y7.48%
ROICexc growth 3Y20.63%
ROICexc growth 5Y7.9%
OM growth 3Y20.43%
OM growth 5Y8.34%
PM growth 3Y61.88%
PM growth 5Y8.11%
GM growth 3Y3.75%
GM growth 5Y2.75%
F-Score7
Asset Turnover0.3
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.86 | ||
| Debt/FCF | 156.2 | ||
| Debt/EBITDA | 3.74 | ||
| Cap/Depr | 196.95% | ||
| Cap/Sales | 33.18% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 66.43% | ||
| Profit Quality | 7.32% | ||
| Current Ratio | 1.81 | ||
| Quick Ratio | 1.3 | ||
| Altman-Z | 0.78 |
F-Score7
WACC8.16%
ROIC/WACC1.01
Cap/Depr(3y)170.5%
Cap/Depr(5y)127.77%
Cap/Sales(3y)29.85%
Cap/Sales(5y)23.62%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)51.11%
EPS 3Y76.8%
EPS 5Y5.59%
EPS Q2Q%69.57%
EPS Next Y51.54%
EPS Next 2Y33.35%
EPS Next 3Y27.4%
EPS Next 5Y22.5%
Revenue 1Y (TTM)28.22%
Revenue growth 3Y13.99%
Revenue growth 5Y3.7%
Sales Q2Q%41.63%
Revenue Next Year28.1%
Revenue Next 2Y16.78%
Revenue Next 3Y13.16%
Revenue Next 5Y10.95%
EBIT growth 1Y54.49%
EBIT growth 3Y37.29%
EBIT growth 5Y12.34%
EBIT Next Year122.08%
EBIT Next 3Y36.5%
EBIT Next 5Y25.05%
FCF growth 1Y118.81%
FCF growth 3Y-20.33%
FCF growth 5YN/A
OCF growth 1Y99.87%
OCF growth 3Y21.86%
OCF growth 5Y8.17%