ARIS WATER SOLUTIONS INC-A (ARIS) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:ARIS - US04041L1061 - Common Stock
23.69 USD
+0.24 (+1.02%)
23.6 USD
-0.09 (-0.38%)
Taking everything into account, ARIS scores 4 out of 10 in our fundamental rating. ARIS was compared to 61 industry peers in the Energy Equipment & Services industry. ARIS has a medium profitability rating, but doesn't score so well on its financial health evaluation. ARIS has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- In the past year ARIS was profitable.
- ARIS had a positive operating cash flow in the past year.
- The reported net income has been mixed in the past 5 years: ARIS reported negative net income in multiple years.
- In the past 5 years ARIS always reported a positive cash flow from operatings.
1.2 Ratios
- ARIS has a worse Return On Assets (1.88%) than 60.66% of its industry peers.
- The Return On Equity of ARIS (7.65%) is comparable to the rest of the industry.
- ARIS has a Return On Invested Capital of 7.39%. This is in the better half of the industry: ARIS outperforms 65.57% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for ARIS is significantly below the industry average of 12.92%.
- The last Return On Invested Capital (7.39%) for ARIS is above the 3 year average (5.83%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.88% | ||
| ROE | 7.65% | ||
| ROIC | 7.39% |
ROA(3y)1.1%
ROA(5y)0.45%
ROE(3y)4.51%
ROE(5y)1.92%
ROIC(3y)5.83%
ROIC(5y)4.48%
1.3 Margins
- ARIS has a Profit Margin of 5.61%. This is comparable to the rest of the industry: ARIS outperforms 54.10% of its industry peers.
- In the last couple of years the Profit Margin of ARIS has declined.
- ARIS's Operating Margin of 23.95% is amongst the best of the industry. ARIS outperforms 90.16% of its industry peers.
- In the last couple of years the Operating Margin of ARIS has grown nicely.
- ARIS's Gross Margin of 39.67% is fine compared to the rest of the industry. ARIS outperforms 78.69% of its industry peers.
- In the last couple of years the Gross Margin of ARIS has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.95% | ||
| PM (TTM) | 5.61% | ||
| GM | 39.67% |
OM growth 3Y6.73%
OM growth 5Y20.3%
PM growth 3YN/A
PM growth 5Y-12.32%
GM growth 3Y6.48%
GM growth 5Y12.28%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ARIS is destroying value.
- The number of shares outstanding for ARIS has been increased compared to 1 year ago.
- The number of shares outstanding for ARIS has been increased compared to 5 years ago.
- ARIS has a better debt/assets ratio than last year.
2.2 Solvency
- ARIS has an Altman-Z score of 1.42. This is a bad value and indicates that ARIS is not financially healthy and even has some risk of bankruptcy.
- Looking at the Altman-Z score, with a value of 1.42, ARIS is doing worse than 65.57% of the companies in the same industry.
- ARIS has a debt to FCF ratio of 4.38. This is a neutral value as ARIS would need 4.38 years to pay back of all of its debts.
- With a Debt to FCF ratio value of 4.38, ARIS perfoms like the industry average, outperforming 50.82% of the companies in the same industry.
- ARIS has a Debt/Equity ratio of 1.27. This is a high value indicating a heavy dependency on external financing.
- ARIS has a Debt to Equity ratio of 1.27. This is amonst the worse of the industry: ARIS underperforms 81.97% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.27 | ||
| Debt/FCF | 4.38 | ||
| Altman-Z | 1.42 |
ROIC/WACC0.83
WACC8.89%
2.3 Liquidity
- A Current Ratio of 1.22 indicates that ARIS should not have too much problems paying its short term obligations.
- The Current ratio of ARIS (1.22) is worse than 83.61% of its industry peers.
- A Quick Ratio of 1.22 indicates that ARIS should not have too much problems paying its short term obligations.
- With a Quick ratio value of 1.22, ARIS is not doing good in the industry: 67.21% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.22 | ||
| Quick Ratio | 1.22 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 16.96% over the past year.
- Measured over the past years, ARIS shows a very strong growth in Earnings Per Share. The EPS has been growing by 27.41% on average per year.
- Looking at the last year, ARIS shows a quite strong growth in Revenue. The Revenue has grown by 16.42% in the last year.
- ARIS shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 29.67% yearly.
EPS 1Y (TTM)16.96%
EPS 3YN/A
EPS 5Y27.41%
EPS Q2Q%13.79%
Revenue 1Y (TTM)16.42%
Revenue growth 3Y23.83%
Revenue growth 5Y29.67%
Sales Q2Q%22.72%
3.2 Future
- ARIS is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.34% yearly.
- ARIS is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.30% yearly.
EPS Next Y16.05%
EPS Next 2Y10.24%
EPS Next 3Y15.21%
EPS Next 5Y19.34%
Revenue Next Year13.96%
Revenue Next 2Y8.75%
Revenue Next 3Y8.08%
Revenue Next 5Y6.3%
3.3 Evolution
- Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- Based on the Price/Earnings ratio of 18.08, the valuation of ARIS can be described as rather expensive.
- Based on the Price/Earnings ratio, ARIS is valued a bit cheaper than 60.66% of the companies in the same industry.
- ARIS is valuated rather cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- ARIS is valuated correctly with a Price/Forward Earnings ratio of 15.47.
- ARIS's Price/Forward Earnings ratio is in line with the industry average.
- ARIS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.08 | ||
| Fwd PE | 15.47 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ARIS indicates a slightly more expensive valuation: ARIS is more expensive than 72.13% of the companies listed in the same industry.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of ARIS is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.62 | ||
| EV/EBITDA | 9.42 |
4.3 Compensation for Growth
- ARIS's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- ARIS has a very decent profitability rating, which may justify a higher PE ratio.
- A more expensive valuation may be justified as ARIS's earnings are expected to grow with 15.21% in the coming years.
PEG (NY)1.13
PEG (5Y)0.66
EPS Next 2Y10.24%
EPS Next 3Y15.21%
5. Dividend
5.1 Amount
- ARIS has a Yearly Dividend Yield of 2.36%. Purely for dividend investing, there may be better candidates out there.
- ARIS's Dividend Yield is a higher than the industry average which is at 1.14.
- Compared to an average S&P500 Dividend Yield of 1.81, ARIS pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.36% |
5.2 History
- ARIS has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
- 111.96% of the earnings are spent on dividend by ARIS. This is not a sustainable payout ratio.
DP111.96%
EPS Next 2Y10.24%
EPS Next 3Y15.21%
ARIS WATER SOLUTIONS INC-A / ARIS FAQ
Can you provide the ChartMill fundamental rating for ARIS WATER SOLUTIONS INC-A?
ChartMill assigns a fundamental rating of 4 / 10 to ARIS.
What is the valuation status for ARIS stock?
ChartMill assigns a valuation rating of 4 / 10 to ARIS WATER SOLUTIONS INC-A (ARIS). This can be considered as Fairly Valued.
How profitable is ARIS WATER SOLUTIONS INC-A (ARIS) stock?
ARIS WATER SOLUTIONS INC-A (ARIS) has a profitability rating of 6 / 10.
Can you provide the expected EPS growth for ARIS stock?
The Earnings per Share (EPS) of ARIS WATER SOLUTIONS INC-A (ARIS) is expected to grow by 16.05% in the next year.
How sustainable is the dividend of ARIS WATER SOLUTIONS INC-A (ARIS) stock?
The dividend rating of ARIS WATER SOLUTIONS INC-A (ARIS) is 2 / 10 and the dividend payout ratio is 111.96%.