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%)
ARIS gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 61 industry peers in the Energy Equipment & Services industry. There are concerns on the financial health of ARIS while its profitability can be described as average. ARIS has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- ARIS had positive earnings in the past year.
- In the past year ARIS had a positive cash flow from operations.
- 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
- Looking at the Return On Assets, with a value of 1.88%, ARIS is doing worse than 60.66% of the companies in the same industry.
- ARIS has a Return On Equity (7.65%) which is in line with its industry peers.
- Looking at the Return On Invested Capital, with a value of 7.39%, ARIS is in the better half of the industry, outperforming 65.57% of the companies in the same industry.
- Measured over the past 3 years, the Average Return On Invested Capital for ARIS is significantly below the industry average of 12.90%.
- 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 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 has a Operating Margin of 23.95%. This is amongst the best in the industry. ARIS outperforms 90.16% of its industry peers.
- 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.
- 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
- The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so 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
- 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.
- ARIS's Altman-Z score of 1.42 is on the low side compared to the rest of the industry. ARIS is outperformed by 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.
- Looking at the Debt to FCF ratio, with a value of 4.38, ARIS is in line with its industry, 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.
- 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
- ARIS has a Current 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.
- 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.
- A Quick Ratio of 1.22 indicates that ARIS should not have too much problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 1.22, ARIS is doing worse than 67.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.22 | ||
| Quick Ratio | 1.22 |
3. Growth
3.1 Past
- ARIS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 16.96%, which is quite good.
- 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
- 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.
- Based on estimates for the next years, ARIS will show a small growth in Revenue. The Revenue will grow by 6.30% on average per year.
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.
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.
- Compared to the rest of the industry, the Price/Earnings ratio of ARIS indicates a somewhat cheap valuation: ARIS is cheaper than 60.66% of the companies listed in the same industry.
- The average S&P500 Price/Earnings ratio is at 28.82. ARIS is valued slightly cheaper when compared to this.
- ARIS is valuated correctly with a Price/Forward Earnings ratio of 15.47.
- The rest of the industry has a similar Price/Forward Earnings ratio as ARIS.
- Compared to an average S&P500 Price/Forward Earnings ratio of 25.95, ARIS is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.08 | ||
| Fwd PE | 15.47 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, ARIS is valued a bit more expensive than 72.13% of the companies in the same industry.
- ARIS's Price/Free Cash Flow is on the same level as 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%
5. Dividend
5.1 Amount
- ARIS has a Yearly Dividend Yield of 2.36%.
- 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 1.82, ARIS pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.36% |
5.2 History
- ARIS has paid a dividend for less than 5 years, so there is no long track record yet.
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%.