ARC RESOURCES LTD (ARX.CA) Stock Fundamental Analysis
TSX:ARX - Toronto Stock Exchange - CA00208D4084 - Common Stock - Currency: CAD
Overall ARX gets a fundamental rating of 7 out of 10. We evaluated ARX against 214 industry peers in the Oil, Gas & Consumable Fuels industry. ARX scores excellent on profitability, but there are some minor concerns on its financial health. ARX has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination! These ratings would make ARX suitable for value and growth investing!
1. Profitability
1.1 Basic Checks
ARX had positive earnings in the past year.
In the past year ARX had a positive cash flow from operations.
Of the past 5 years ARX 4 years were profitable.
In the past 5 years ARX always reported a positive cash flow from operatings.
1.2 Ratios
ARX's Return On Assets of 10.30% is amongst the best of the industry. ARX outperforms 92.06% of its industry peers.
ARX's Return On Equity of 16.59% is amongst the best of the industry. ARX outperforms 91.12% of its industry peers.
The Return On Invested Capital of ARX (9.94%) is better than 90.19% of its industry peers.
ARX had an Average Return On Invested Capital over the past 3 years of 16.99%. This is significantly above the industry average of 7.31%.
The 3 year average ROIC (16.99%) for ARX is well above the current ROIC(9.94%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.3% | ||
| ROE | 16.59% | ||
| ROIC | 9.94% |
ROA(3y)13.76%
ROA(5y)7.43%
ROE(3y)23.41%
ROE(5y)12.78%
ROIC(3y)16.99%
ROIC(5y)13.58%
1.3 Margins
The Profit Margin of ARX (24.63%) is better than 85.98% of its industry peers.
In the last couple of years the Profit Margin of ARX has grown nicely.
ARX has a better Operating Margin (27.21%) than 78.97% of its industry peers.
In the last couple of years the Operating Margin of ARX has grown nicely.
ARX has a Gross Margin of 69.05%. This is amongst the best in the industry. ARX outperforms 87.38% of its industry peers.
In the last couple of years the Gross Margin of ARX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.21% | ||
| PM (TTM) | 24.63% | ||
| GM | 69.05% |
OM growth 3Y-15.37%
OM growth 5Y23.89%
PM growth 3Y12.7%
PM growth 5YN/A
GM growth 3Y-2.53%
GM growth 5Y-0.87%
2. Health
2.1 Basic Checks
ARX has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
ARX has less shares outstanding than it did 1 year ago.
The number of shares outstanding for ARX has been increased compared to 5 years ago.
Compared to 1 year ago, ARX has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 3.14 indicates that ARX is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.14, ARX is in the better half of the industry, outperforming 79.44% of the companies in the same industry.
ARX has a debt to FCF ratio of 2.18. This is a good value and a sign of high solvency as ARX would need 2.18 years to pay back of all of its debts.
ARX has a Debt to FCF ratio of 2.18. This is amongst the best in the industry. ARX outperforms 84.11% of its industry peers.
A Debt/Equity ratio of 0.19 indicates that ARX is not too dependend on debt financing.
ARX's Debt to Equity ratio of 0.19 is fine compared to the rest of the industry. ARX outperforms 64.02% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 2.18 | ||
| Altman-Z | 3.14 |
ROIC/WACC1.36
WACC7.32%
2.3 Liquidity
ARX has a Current Ratio of 0.60. This is a bad value and indicates that ARX is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 0.60, ARX is doing worse than 73.83% of the companies in the same industry.
A Quick Ratio of 0.59 indicates that ARX may have some problems paying its short term obligations.
ARX has a Quick ratio of 0.59. This is in the lower half of the industry: ARX underperforms 66.82% of its industry peers.
The current and quick ratio evaluation for ARX is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.59 |
3. Growth
3.1 Past
ARX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 13.50%, which is quite good.
The Earnings Per Share has been growing by 14.78% on average over the past years. This is quite good.
Looking at the last year, ARX shows a small growth in Revenue. The Revenue has grown by 3.05% in the last year.
The Revenue has been growing by 33.07% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)13.5%
EPS 3Y14.78%
EPS 5YN/A
EPS Q2Q%122.58%
Revenue 1Y (TTM)3.05%
Revenue growth 3Y-0.06%
Revenue growth 5Y33.07%
Sales Q2Q%24.75%
3.2 Future
Based on estimates for the next years, ARX will show a very strong growth in Earnings Per Share. The EPS will grow by 24.35% on average per year.
ARX is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.81% yearly.
EPS Next Y73.12%
EPS Next 2Y29.99%
EPS Next 3Y28.36%
EPS Next 5Y24.35%
Revenue Next Year12.94%
Revenue Next 2Y5.89%
Revenue Next 3Y3.17%
Revenue Next 5Y9.81%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 13.57, the valuation of ARX can be described as correct.
Based on the Price/Earnings ratio, ARX is valued a bit cheaper than the industry average as 64.49% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 26.35. ARX is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 9.64 indicates a reasonable valuation of ARX.
Based on the Price/Forward Earnings ratio, ARX is valued a bit cheaper than the industry average as 64.02% of the companies are valued more expensively.
ARX is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.19, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.57 | ||
| Fwd PE | 9.64 |
4.2 Price Multiples
70.09% of the companies in the same industry are more expensive than ARX, based on the Enterprise Value to EBITDA ratio.
ARX's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ARX is cheaper than 64.02% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.2 | ||
| EV/EBITDA | 7.05 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ARX has an outstanding profitability rating, which may justify a higher PE ratio.
ARX's earnings are expected to grow with 28.36% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.19
PEG (5Y)N/A
EPS Next 2Y29.99%
EPS Next 3Y28.36%
5. Dividend
5.1 Amount
ARX has a Yearly Dividend Yield of 2.47%.
ARX's Dividend Yield is comparable with the industry average which is at 6.13.
ARX's Dividend Yield is comparable with the S&P500 average which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.47% |
5.2 History
The dividend of ARX has a limited annual growth rate of 2.59%.
ARX has paid a dividend for at least 10 years, which is a reliable track record.
ARX has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)2.59%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
30.98% of the earnings are spent on dividend by ARX. This is a low number and sustainable payout ratio.
ARX's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP30.98%
EPS Next 2Y29.99%
EPS Next 3Y28.36%
TSX:ARX (6/20/2025, 7:00:00 PM)
30.8
0 (0%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners39.56%
Inst Owner ChangeN/A
Ins Owners0.42%
Ins Owner ChangeN/A
Market Cap18.05B
Analysts82.86
Price Target34.75 (12.82%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.47% |
Yearly Dividend0.68
Dividend Growth(5Y)2.59%
DP30.98%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.89%
Min EPS beat(2)-6.74%
Max EPS beat(2)20.52%
EPS beat(4)3
Avg EPS beat(4)27.67%
Min EPS beat(4)-6.74%
Max EPS beat(4)57.44%
EPS beat(8)5
Avg EPS beat(8)17.64%
EPS beat(12)9
Avg EPS beat(12)29.68%
EPS beat(16)10
Avg EPS beat(16)2.48%
Revenue beat(2)2
Avg Revenue beat(2)8.09%
Min Revenue beat(2)3.66%
Max Revenue beat(2)12.52%
Revenue beat(4)4
Avg Revenue beat(4)10.56%
Min Revenue beat(4)3.66%
Max Revenue beat(4)18%
Revenue beat(8)8
Avg Revenue beat(8)11.37%
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)4.06%
PT rev (3m)2.91%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-19.02%
EPS NY rev (1m)0%
EPS NY rev (3m)6.14%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)2.4%
Revenue NY rev (1m)0%
Revenue NY rev (3m)4.1%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.57 | ||
| Fwd PE | 9.64 | ||
| P/S | 3.31 | ||
| P/FCF | 19.2 | ||
| P/OCF | 6.62 | ||
| P/B | 2.23 | ||
| P/tB | 2.3 | ||
| EV/EBITDA | 7.05 |
EPS(TTM)2.27
EY7.37%
EPS(NY)3.19
Fwd EY10.37%
FCF(TTM)1.6
FCFY5.21%
OCF(TTM)4.65
OCFY15.1%
SpS9.31
BVpS13.82
TBVpS13.4
PEG (NY)0.19
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.3% | ||
| ROE | 16.59% | ||
| ROCE | 12.84% | ||
| ROIC | 9.94% | ||
| ROICexc | 9.95% | ||
| ROICexgc | 10.16% | ||
| OM | 27.21% | ||
| PM (TTM) | 24.63% | ||
| GM | 69.05% | ||
| FCFM | 17.23% |
ROA(3y)13.76%
ROA(5y)7.43%
ROE(3y)23.41%
ROE(5y)12.78%
ROIC(3y)16.99%
ROIC(5y)13.58%
ROICexc(3y)17.05%
ROICexc(5y)13.61%
ROICexgc(3y)17.46%
ROICexgc(5y)13.96%
ROCE(3y)21.94%
ROCE(5y)17.54%
ROICexcg growth 3Y-21.36%
ROICexcg growth 5Y39.3%
ROICexc growth 3Y-21.23%
ROICexc growth 5Y40.04%
OM growth 3Y-15.37%
OM growth 5Y23.89%
PM growth 3Y12.7%
PM growth 5YN/A
GM growth 3Y-2.53%
GM growth 5Y-0.87%
F-Score6
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.19 | ||
| Debt/FCF | 2.18 | ||
| Debt/EBITDA | 0.53 | ||
| Cap/Depr | 130.65% | ||
| Cap/Sales | 32.74% | ||
| Interest Coverage | 12.87 | ||
| Cash Conversion | 95.61% | ||
| Profit Quality | 69.96% | ||
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.59 | ||
| Altman-Z | 3.14 |
F-Score6
WACC7.32%
ROIC/WACC1.36
Cap/Depr(3y)124.75%
Cap/Depr(5y)99.95%
Cap/Sales(3y)28.25%
Cap/Sales(5y)26.97%
Profit Quality(3y)61.71%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)13.5%
EPS 3Y14.78%
EPS 5YN/A
EPS Q2Q%122.58%
EPS Next Y73.12%
EPS Next 2Y29.99%
EPS Next 3Y28.36%
EPS Next 5Y24.35%
Revenue 1Y (TTM)3.05%
Revenue growth 3Y-0.06%
Revenue growth 5Y33.07%
Sales Q2Q%24.75%
Revenue Next Year12.94%
Revenue Next 2Y5.89%
Revenue Next 3Y3.17%
Revenue Next 5Y9.81%
EBIT growth 1Y5.58%
EBIT growth 3Y-15.42%
EBIT growth 5Y64.86%
EBIT Next Year176.6%
EBIT Next 3Y40.65%
EBIT Next 5YN/A
FCF growth 1Y-53.78%
FCF growth 3Y-18.47%
FCF growth 5YN/A
OCF growth 1Y-24.61%
OCF growth 3Y5.39%
OCF growth 5Y29.74%