5.14 USD
-0.09 (-1.72%)
5.14 USD
0 (0%)
Taking everything into account, ARKO scores 4 out of 10 in our fundamental rating. ARKO was compared to 122 industry peers in the Specialty Retail industry. Both the profitability and the financial health of ARKO get a neutral evaluation. Nothing too spectacular is happening here. ARKO does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
- ARKO had positive earnings in the past year.
- In the past year ARKO had a positive cash flow from operations.
- Each year in the past 5 years ARKO has been profitable.
- In the past 5 years ARKO always reported a positive cash flow from operatings.
1.2 Ratios
- With a Return On Assets value of 0.36%, ARKO perfoms like the industry average, outperforming 50.82% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 3.44%, ARKO is in line with its industry, outperforming 59.02% of the companies in the same industry.
- ARKO has a Return On Invested Capital (2.13%) which is comparable to the rest of the industry.
- Measured over the past 3 years, the Average Return On Invested Capital for ARKO is significantly below the industry average of 12.24%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.36% | ||
| ROE | 3.44% | ||
| ROIC | 2.13% |
ROA(3y)1.08%
ROA(5y)1.09%
ROE(3y)9.65%
ROE(5y)9.47%
ROIC(3y)3.4%
ROIC(5y)3.4%
1.3 Margins
- With a Profit Margin value of 0.16%, ARKO perfoms like the industry average, outperforming 50.82% of the companies in the same industry.
- In the last couple of years the Profit Margin of ARKO has declined.
- With a Operating Margin value of 1.12%, ARKO perfoms like the industry average, outperforming 42.62% of the companies in the same industry.
- In the last couple of years the Operating Margin of ARKO has grown nicely.
- ARKO's Gross Margin of 15.23% is on the low side compared to the rest of the industry. ARKO is outperformed by 85.25% of its industry peers.
- In the last couple of years the Gross Margin of ARKO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.12% | ||
| PM (TTM) | 0.16% | ||
| GM | 15.23% |
OM growth 3Y-14.11%
OM growth 5Y107.59%
PM growth 3Y-37.88%
PM growth 5YN/A
GM growth 3Y2.7%
GM growth 5Y-1.33%
2. Health
2.1 Basic Checks
- ARKO has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- Compared to 1 year ago, ARKO has less shares outstanding
- Compared to 5 years ago, ARKO has less shares outstanding
- The debt/assets ratio for ARKO is higher compared to a year ago.
2.2 Solvency
- ARKO has an Altman-Z score of 2.51. This is not the best score and indicates that ARKO is in the grey zone with still only limited risk for bankruptcy at the moment.
- The Altman-Z score of ARKO (2.51) is comparable to the rest of the industry.
- ARKO has a debt to FCF ratio of 30.42. This is a negative value and a sign of low solvency as ARKO would need 30.42 years to pay back of all of its debts.
- ARKO has a Debt to FCF ratio (30.42) which is in line with its industry peers.
- A Debt/Equity ratio of 2.88 is on the high side and indicates that ARKO has dependencies on debt financing.
- ARKO has a worse Debt to Equity ratio (2.88) than 72.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.88 | ||
| Debt/FCF | 30.42 | ||
| Altman-Z | 2.51 |
ROIC/WACC0.22
WACC9.67%
2.3 Liquidity
- ARKO has a Current Ratio of 1.62. This is a normal value and indicates that ARKO is financially healthy and should not expect problems in meeting its short term obligations.
- With a decent Current ratio value of 1.62, ARKO is doing good in the industry, outperforming 66.39% of the companies in the same industry.
- ARKO has a Quick Ratio of 1.18. This is a normal value and indicates that ARKO is financially healthy and should not expect problems in meeting its short term obligations.
- ARKO has a better Quick ratio (1.18) than 79.51% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.62 | ||
| Quick Ratio | 1.18 |
3. Growth
3.1 Past
- The earnings per share for ARKO have decreased strongly by -31.25% in the last year.
- Measured over the past years, ARKO shows a very negative growth in Earnings Per Share. The EPS has been decreasing by -33.40% on average per year.
- ARKO shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -12.61%.
- The Revenue has been growing by 16.16% on average over the past years. This is quite good.
EPS 1Y (TTM)-31.25%
EPS 3Y-33.4%
EPS 5YN/A
EPS Q2Q%42.86%
Revenue 1Y (TTM)-12.61%
Revenue growth 3Y5.59%
Revenue growth 5Y16.16%
Sales Q2Q%-11.34%
3.2 Future
- The Earnings Per Share is expected to grow by 10.50% on average over the next years. This is quite good.
- The Revenue is expected to decrease by -3.54% on average over the next years.
EPS Next Y2%
EPS Next 2Y-2.97%
EPS Next 3Y12.2%
EPS Next 5Y10.5%
Revenue Next Year-13.63%
Revenue Next 2Y-9.36%
Revenue Next 3Y-6.48%
Revenue Next 5Y-3.54%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last 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
- ARKO is valuated quite expensively with a Price/Earnings ratio of 46.73.
- The rest of the industry has a similar Price/Earnings ratio as ARKO.
- The average S&P500 Price/Earnings ratio is at 28.60. ARKO is valued rather expensively when compared to this.
- A Price/Forward Earnings ratio of 41.99 indicates a quite expensive valuation of ARKO.
- The rest of the industry has a similar Price/Forward Earnings ratio as ARKO.
- ARKO is valuated expensively when we compare the Price/Forward Earnings ratio to 25.83, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 46.73 | ||
| Fwd PE | 41.99 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, ARKO is valued cheaply inside the industry as 81.15% of the companies are valued more expensively.
- ARKO's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ARKO is cheaper than 73.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.5 | ||
| EV/EBITDA | 6.21 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ARKO does not grow enough to justify the current Price/Earnings ratio.
- A more expensive valuation may be justified as ARKO's earnings are expected to grow with 12.20% in the coming years.
PEG (NY)23.36
PEG (5Y)N/A
EPS Next 2Y-2.97%
EPS Next 3Y12.2%
5. Dividend
5.1 Amount
- ARKO has a Yearly Dividend Yield of 2.32%. Purely for dividend investing, there may be better candidates out there.
- Compared to an average industry Dividend Yield of 2.15, ARKO pays a bit more dividend than its industry peers.
- ARKO's Dividend Yield is a higher than the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.32% |
5.2 History
- ARKO 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 Years0
Div Non Decr Years2
5.3 Sustainability
- 151.91% of the earnings are spent on dividend by ARKO. This is not a sustainable payout ratio.
DP151.91%
EPS Next 2Y-2.97%
EPS Next 3Y12.2%
ARKO CORP / ARKO FAQ
What is the ChartMill fundamental rating of ARKO CORP (ARKO) stock?
ChartMill assigns a fundamental rating of 4 / 10 to ARKO.
Can you provide the valuation status for ARKO CORP?
ChartMill assigns a valuation rating of 3 / 10 to ARKO CORP (ARKO). This can be considered as Overvalued.
How profitable is ARKO CORP (ARKO) stock?
ARKO CORP (ARKO) has a profitability rating of 4 / 10.
What are the PE and PB ratios of ARKO CORP (ARKO) stock?
The Price/Earnings (PE) ratio for ARKO CORP (ARKO) is 46.73 and the Price/Book (PB) ratio is 1.54.
What is the earnings growth outlook for ARKO CORP?
The Earnings per Share (EPS) of ARKO CORP (ARKO) is expected to grow by 2% in the next year.