ARC RESOURCES LTD (ARX.CA) Stock Fundamental Analysis
Canada - TSX:ARX - CA00208D4084 - Common Stock
25.09 CAD
+0.32 (+1.29%)
We assign a fundamental rating of 8 out of 10 to ARX. ARX was compared to 220 industry peers in the Oil, Gas & Consumable Fuels industry. ARX has an excellent profitability rating, 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! With these ratings, ARX could be worth investigating further for value and growth investing!.
1. Profitability
1.1 Basic Checks
In the past year ARX was profitable.
ARX had a positive operating cash flow in the past year.
Of the past 5 years ARX 4 years were profitable.
ARX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
ARX's Return On Assets of 10.58% is amongst the best of the industry. ARX outperforms 92.73% of its industry peers.
Looking at the Return On Equity, with a value of 18.08%, ARX belongs to the top of the industry, outperforming 91.36% of the companies in the same industry.
ARX has a Return On Invested Capital of 10.19%. This is amongst the best in the industry. ARX outperforms 92.27% of its industry peers.
The Average Return On Invested Capital over the past 3 years for ARX is significantly above the industry average of 6.91%.
The last Return On Invested Capital (10.19%) for ARX is well below the 3 year average (16.99%), which needs to be investigated, but indicates that ARX had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.58% | ||
| ROE | 18.08% | ||
| ROIC | 10.19% |
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
ARX has a better Profit Margin (26.24%) than 86.36% of its industry peers.
ARX's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 29.11%, ARX belongs to the top of the industry, outperforming 80.91% of the companies in the same industry.
ARX's Operating Margin has improved in the last couple of years.
ARX has a better Gross Margin (69.84%) than 90.00% 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 | 29.11% | ||
| PM (TTM) | 26.24% | ||
| GM | 69.84% |
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ARX is creating value.
Compared to 1 year ago, ARX has less shares outstanding
ARX has more shares outstanding than it did 5 years ago.
ARX has a worse debt/assets ratio than last year.
2.2 Solvency
ARX has an Altman-Z score of 2.52. This is not the best score and indicates that ARX is in the grey zone with still only limited risk for bankruptcy at the moment.
ARX has a better Altman-Z score (2.52) than 76.36% of its industry peers.
The Debt to FCF ratio of ARX is 2.58, which is a good value as it means it would take ARX, 2.58 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.58, ARX belongs to the top of the industry, outperforming 86.82% of the companies in the same industry.
ARX has a Debt/Equity ratio of 0.29. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.29, ARX is in line with its industry, outperforming 59.09% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.58 | ||
| Altman-Z | 2.52 |
ROIC/WACC1.3
WACC7.81%
2.3 Liquidity
ARX has a Current Ratio of 1.21. This is a normal value and indicates that ARX is financially healthy and should not expect problems in meeting its short term obligations.
ARX's Current ratio of 1.21 is fine compared to the rest of the industry. ARX outperforms 64.55% of its industry peers.
ARX has a Quick Ratio of 1.20. This is a normal value and indicates that ARX is financially healthy and should not expect problems in meeting its short term obligations.
ARX has a better Quick ratio (1.20) than 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 31.44% over the past year.
The Earnings Per Share has been growing by 14.78% on average over the past years. This is quite good.
ARX shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.09%.
Measured over the past years, ARX shows a very strong growth in Revenue. The Revenue has been growing by 33.07% on average per year.
EPS 1Y (TTM)31.44%
EPS 3Y14.78%
EPS 5YN/A
EPS Q2Q%70%
Revenue 1Y (TTM)9.09%
Revenue growth 3Y-0.06%
Revenue growth 5Y33.07%
Sales Q2Q%35.68%
3.2 Future
ARX is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 24.35% yearly.
Based on estimates for the next years, ARX will show a small growth in Revenue. The Revenue will grow by 7.69% on average per year.
EPS Next Y51.36%
EPS Next 2Y32.25%
EPS Next 3Y33.29%
EPS Next 5Y24.35%
Revenue Next Year17.97%
Revenue Next 2Y11.98%
Revenue Next 3Y7.62%
Revenue Next 5Y7.69%
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
ARX is valuated reasonably with a Price/Earnings ratio of 9.84.
70.91% of the companies in the same industry are more expensive than ARX, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.41. ARX is valued rather cheaply when compared to this.
Based on the Price/Forward Earnings ratio of 7.59, the valuation of ARX can be described as very cheap.
Based on the Price/Forward Earnings ratio, ARX is valued a bit cheaper than 77.27% of the companies in the same industry.
ARX's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.84 | ||
| Fwd PE | 7.59 |
4.2 Price Multiples
85.45% of the companies in the same industry are more expensive than ARX, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, ARX is valued a bit cheaper than the industry average as 71.82% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.8 | ||
| EV/EBITDA | 5.4 |
4.3 Compensation for Growth
ARX's 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 33.29% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.19
PEG (5Y)N/A
EPS Next 2Y32.25%
EPS Next 3Y33.29%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 3.06%, ARX has a reasonable but not impressive dividend return.
ARX's Dividend Yield is a higher than the industry average which is at 6.65.
ARX's Dividend Yield is a higher than the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.06% |
5.2 History
The dividend of ARX has a limited annual growth rate of 2.59%.
ARX has been paying a dividend for at least 10 years, so it has 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
28.39% 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.
DP28.39%
EPS Next 2Y32.25%
EPS Next 3Y33.29%
TSX:ARX (9/22/2025, 7:00:00 PM)
25.09
+0.32 (+1.29%)
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 Cap14.59B
Analysts83.48
Price Target34.75 (38.5%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.06% |
Yearly Dividend0.68
Dividend Growth(5Y)2.59%
DP28.39%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)16.52%
Min EPS beat(2)-6.74%
Max EPS beat(2)39.77%
EPS beat(4)3
Avg EPS beat(4)27.75%
Min EPS beat(4)-6.74%
Max EPS beat(4)57.44%
EPS beat(8)5
Avg EPS beat(8)19.88%
EPS beat(12)9
Avg EPS beat(12)29.45%
EPS beat(16)11
Avg EPS beat(16)16.61%
Revenue beat(2)2
Avg Revenue beat(2)12.95%
Min Revenue beat(2)12.52%
Max Revenue beat(2)13.38%
Revenue beat(4)4
Avg Revenue beat(4)9.41%
Min Revenue beat(4)3.66%
Max Revenue beat(4)13.38%
Revenue beat(8)8
Avg Revenue beat(8)12.74%
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)-0.76%
PT rev (3m)-0.01%
EPS NQ rev (1m)-11.08%
EPS NQ rev (3m)-21.38%
EPS NY rev (1m)0%
EPS NY rev (3m)-12.57%
Revenue NQ rev (1m)-2.33%
Revenue NQ rev (3m)-10.78%
Revenue NY rev (1m)0%
Revenue NY rev (3m)4.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.84 | ||
| Fwd PE | 7.59 | ||
| P/S | 2.55 | ||
| P/FCF | 12.8 | ||
| P/OCF | 5.06 | ||
| P/B | 1.76 | ||
| P/tB | 1.81 | ||
| EV/EBITDA | 5.4 |
EPS(TTM)2.55
EY10.16%
EPS(NY)3.31
Fwd EY13.18%
FCF(TTM)1.96
FCFY7.81%
OCF(TTM)4.96
OCFY19.75%
SpS9.83
BVpS14.27
TBVpS13.84
PEG (NY)0.19
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.58% | ||
| ROE | 18.08% | ||
| ROCE | 13.16% | ||
| ROIC | 10.19% | ||
| ROICexc | 11.01% | ||
| ROICexgc | 11.25% | ||
| OM | 29.11% | ||
| PM (TTM) | 26.24% | ||
| GM | 69.84% | ||
| FCFM | 19.93% |
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-Score8
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.58 | ||
| Debt/EBITDA | 0.79 | ||
| Cap/Depr | 124.06% | ||
| Cap/Sales | 30.48% | ||
| Interest Coverage | 15.25 | ||
| Cash Conversion | 93.92% | ||
| Profit Quality | 75.96% | ||
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 2.52 |
F-Score8
WACC7.81%
ROIC/WACC1.3
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)31.44%
EPS 3Y14.78%
EPS 5YN/A
EPS Q2Q%70%
EPS Next Y51.36%
EPS Next 2Y32.25%
EPS Next 3Y33.29%
EPS Next 5Y24.35%
Revenue 1Y (TTM)9.09%
Revenue growth 3Y-0.06%
Revenue growth 5Y33.07%
Sales Q2Q%35.68%
Revenue Next Year17.97%
Revenue Next 2Y11.98%
Revenue Next 3Y7.62%
Revenue Next 5Y7.69%
EBIT growth 1Y25.39%
EBIT growth 3Y-15.42%
EBIT growth 5Y64.86%
EBIT Next Year176.6%
EBIT Next 3Y40.65%
EBIT Next 5YN/A
FCF growth 1Y-19.97%
FCF growth 3Y-18.47%
FCF growth 5YN/A
OCF growth 1Y-6.24%
OCF growth 3Y5.39%
OCF growth 5Y29.74%