We assign a fundamental rating of 4 out of 10 to ARIS. ARIS was compared to 62 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 is not valued too expensively and it also shows a decent growth rate.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year ARIS was profitable.
ARIS had a positive operating cash flow in the past year.
In multiple years ARIS reported negative net income over the last 5 years.
In the past 5 years ARIS always reported a positive cash flow from operatings.

1.2 Ratios

With a Return On Assets value of 1.88%, ARIS is not doing good in the industry: 60.66% of the companies in the same industry are doing better.
ARIS's Return On Equity of 7.65% is in line compared to the rest of the industry. ARIS outperforms 57.38% of its industry peers.
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 12.77%.
The 3 year average ROIC (5.83%) for ARIS is below the current ROIC(7.39%), indicating increased profibility in the last year.

		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 (5.61%) which is comparable to the rest of the industry.
ARIS's Profit Margin has declined in the last couple of years.
With an excellent Operating Margin value of 23.95%, ARIS belongs to the best of the industry, outperforming 90.16% of the companies in the same industry.
In the last couple of years the Operating Margin of ARIS has grown nicely.
The Gross Margin of ARIS (39.67%) is better than 78.69% of its industry peers.
ARIS's Gross Margin has improved in the last couple of years.

		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%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), ARIS is destroying value.
ARIS has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, ARIS has more shares outstanding
The debt/assets ratio for ARIS has been reduced compared to a year ago.

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.
ARIS has a Altman-Z score of 1.42. This is in the lower half of the industry: ARIS underperforms 65.57% of its industry peers.
The Debt to FCF ratio of ARIS is 4.38, which is a neutral value as it means it would take ARIS, 4.38 years of fcf income to pay off all of its debts.
ARIS has a Debt to FCF ratio of 4.38. This is comparable to the rest of the industry: ARIS outperforms 50.82% of its industry peers.
A Debt/Equity ratio of 1.27 is on the high side and indicates that ARIS has dependencies on debt financing.
With a Debt to Equity ratio value of 1.27, ARIS is not doing good in the industry: 81.97% of the companies in the same industry are doing better.

		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.
With a Current ratio value of 1.22, ARIS is not doing good in the industry: 83.61% of the companies in the same industry are doing better.
ARIS has a Quick Ratio of 1.22. This is a normal value and indicates that ARIS is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of ARIS (1.22) is worse than 67.21% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.22
Quick Ratio	1.22

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 16.96% over the past year.
The Earnings Per Share has been growing by 27.41% on average over the past years. This is a very strong growth
Looking at the last year, ARIS shows a quite strong growth in Revenue. The Revenue has grown by 16.42% in the last year.
Measured over the past years, ARIS shows a very strong growth in Revenue. The Revenue has been growing by 29.67% on average per year.

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

The Earnings Per Share is expected to grow by 19.34% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.30% on average over the next years.

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

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 18.08 indicates a rather expensive valuation of ARIS.
ARIS's Price/Earnings ratio is a bit cheaper when compared to the industry. ARIS is cheaper than 60.66% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.32, ARIS is valued a bit cheaper.
With a Price/Forward Earnings ratio of 15.47, ARIS is valued correctly.
The rest of the industry has a similar Price/Forward Earnings ratio as ARIS.
ARIS is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.32, 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

72.13% of the companies in the same industry are cheaper than ARIS, based on the Enterprise Value to EBITDA ratio.
ARIS's Price/Free Cash Flow ratio is in line with the industry average.

		Industry Rank	Sector Rank
P/FCF	13.62
EV/EBITDA	9.42

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of ARIS 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%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 2.36%, ARIS has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 1.17, ARIS pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 1.83, 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%

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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%.