Archrock, Inc.
Archrock, Inc. Fundamental Analysis
Archrock, Inc. (AROC) shows moderate financial fundamentals with a PE ratio of 21.48, profit margin of 18.43%, and ROE of 19.28%. The company generates $1.4B in annual revenue with strong year-over-year growth of 16.89%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 59.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze AROC's fundamental strength across five key dimensions:
Efficiency Score
WeakAROC struggles to generate sufficient returns from assets.
Valuation Score
ExcellentAROC trades at attractive valuation levels.
Growth Score
ExcellentAROC delivers strong and consistent growth momentum.
Financial Health Score
ModerateAROC shows balanced financial health with some risks.
Profitability Score
ExcellentAROC achieves industry-leading margins.
Key Financial Metrics
Is AROC Expensive or Cheap?
P/E Ratio
AROC trades at 21.48 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, AROC's PEG of 1.58 indicates fair valuation.
Price to Book
The market values Archrock, Inc. at 4.01 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 4.15 times EBITDA. This is generally considered low.
How Well Does AROC Make Money?
Net Profit Margin
For every $100 in sales, Archrock, Inc. keeps $18.43 as profit after all expenses.
Operating Margin
Core operations generate 39.66 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $19.28 in profit for every $100 of shareholder equity.
ROA
Archrock, Inc. generates $6.02 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Archrock, Inc. generates strong operating cash flow of $534.25M, reflecting robust business health.
Free Cash Flow
Archrock, Inc. generates weak or negative free cash flow of $19.40M, restricting financial flexibility.
FCF Per Share
Each share generates $0.11 in free cash annually.
FCF Yield
AROC converts 0.34% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.48
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.58
vs 25 benchmark
P/B Ratio
Price to book value ratio
4.007
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.98
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.81
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.56
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.19
vs 25 benchmark
ROA
Return on assets percentage
0.06
vs 25 benchmark
ROCE
Return on capital employed
0.14
vs 25 benchmark
How AROC Stacks Against Its Sector Peers
| Metric | AROC Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.48 | 20.19 | Neutral |
| ROE | 19.28% | 1019.00% | Weak |
| Net Margin | 18.43% | -44017.00% (disorted) | Strong |
| Debt/Equity | 1.81 | -0.65 (disorted) | Distorted |
| Current Ratio | 1.56 | 4.60 | Neutral |
| ROA | 6.02% | -11655350.00% (disorted) | Weak |
AROC outperforms its industry in 1 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Archrock, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
1.74%
Industry Style: Cyclical, Value, Commodity
GrowingEPS CAGR
50.15%
Industry Style: Cyclical, Value, Commodity
High GrowthFCF CAGR
25.63%
Industry Style: Cyclical, Value, Commodity
High Growth