ARC RESOURCES LTD (ARX.CA)
CA00208D4084 - Common Stock
We assign a fundamental rating of 6 out of 10 to ARX. ARX was compared to 220 industry peers in the Oil, Gas & Consumable Fuels industry. ARX has an excellent profitability rating, but there are some minor concerns on its financial health. A decent growth rate in combination with a cheap valuation! Better keep an eye on ARX.
1. Profitability
1.1 Basic Checks
In the past year ARX was profitable.
ARX had a positive operating cash flow in the past year.
In multiple years ARX reported negative net income over the last 5 years.
ARX had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 9.27%, ARX belongs to the top of the industry, outperforming 91.59% of the companies in the same industry.
ARX has a better Return On Equity (15.31%) than 86.92% of its industry peers.
ARX's Return On Invested Capital of 8.73% is amongst the best of the industry. ARX outperforms 82.24% of its industry peers.
ARX had an Average Return On Invested Capital over the past 3 years of 19.71%. This is significantly above the industry average of 7.79%.
The last Return On Invested Capital (8.73%) for ARX is well below the 3 year average (19.71%), which needs to be investigated, but indicates that ARX had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.27% | ||
| ROE | 15.31% | ||
| ROIC | 8.73% |
ROA(3y)13.2%
ROA(5y)5.62%
ROE(3y)23.12%
ROE(5y)9.79%
ROIC(3y)19.71%
ROIC(5y)12.31%
1.3 Margins
With an excellent Profit Margin value of 22.29%, ARX belongs to the best of the industry, outperforming 83.18% of the companies in the same industry.
ARX's Profit Margin has improved in the last couple of years.
ARX has a Operating Margin of 25.32%. This is in the better half of the industry: ARX outperforms 71.50% of its industry peers.
In the last couple of years the Operating Margin of ARX has grown nicely.
ARX's Gross Margin of 68.97% is amongst the best of the industry. ARX outperforms 83.64% of its industry peers.
In the last couple of years the Gross Margin of ARX has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.32% | ||
| PM (TTM) | 22.29% | ||
| GM | 68.97% |
OM growth 3Y79.97%
OM growth 5Y13.03%
PM growth 3YN/A
PM growth 5Y12.96%
GM growth 3Y-2.48%
GM growth 5Y0.45%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ARX is creating value.
There is no outstanding debt for ARX. This means it has a Debt/Equity and Debt/FCF ratio of 0 and it is amongst the best of the sector and industry.
2.2 Solvency
An Altman-Z score of 2.58 indicates that ARX is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.58, ARX is in the better half of the industry, outperforming 72.90% of the companies in the same industry.
The Debt to FCF ratio of ARX is 4.67, which is a neutral value as it means it would take ARX, 4.67 years of fcf income to pay off all of its debts.
ARX has a Debt to FCF ratio of 4.67. This is in the better half of the industry: ARX outperforms 79.44% of its industry peers.
A Debt/Equity ratio of 0.30 indicates that ARX is not too dependend on debt financing.
The Debt to Equity ratio of ARX (0.30) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.3 | ||
| Debt/FCF | 4.67 | ||
| Altman-Z | 2.58 |
ROIC/WACC1.17
WACC7.45%
2.3 Liquidity
A Current Ratio of 0.88 indicates that ARX may have some problems paying its short term obligations.
With a Current ratio value of 0.88, ARX perfoms like the industry average, outperforming 53.74% of the companies in the same industry.
A Quick Ratio of 0.88 indicates that ARX may have some problems paying its short term obligations.
ARX has a Quick ratio of 0.88. This is comparable to the rest of the industry: ARX outperforms 56.07% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 |
3. Growth
3.1 Past
The earnings per share for ARX have decreased strongly by -47.29% in the last year.
The Earnings Per Share has been growing by 35.44% on average over the past years. This is a very strong growth
Looking at the last year, ARX shows a very negative growth in Revenue. The Revenue has decreased by -27.01% in the last year.
Measured over the past years, ARX shows a very strong growth in Revenue. The Revenue has been growing by 32.34% on average per year.
EPS 1Y (TTM)-47.29%
EPS 3Y73.75%
EPS 5Y35.44%
EPS Q2Q%-12.53%
Revenue 1Y (TTM)-27.01%
Revenue growth 3Y70.91%
Revenue growth 5Y32.34%
Sales Q2Q%-3.24%
3.2 Future
The Earnings Per Share is expected to grow by 11.16% on average over the next years. This is quite good.
The Revenue is expected to grow by 5.92% on average over the next years.
EPS Next Y-11.51%
EPS Next 2Y11.47%
EPS Next 3Y14.21%
EPS Next 5Y11.16%
Revenue Next Year-2.74%
Revenue Next 2Y1.26%
Revenue Next 3Y5.09%
Revenue Next 5Y5.92%
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
The Price/Earnings ratio is 11.99, which indicates a very decent valuation of ARX.
Based on the Price/Earnings ratio, ARX is valued a bit cheaper than 61.68% of the companies in the same industry.
ARX's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 30.57.
A Price/Forward Earnings ratio of 6.77 indicates a rather cheap valuation of ARX.
ARX's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ARX is cheaper than 64.02% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.04. ARX is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.99 | ||
| Fwd PE | 6.77 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ARX is valued a bit cheaper than the industry average as 70.09% of the companies are valued more expensively.
60.28% of the companies in the same industry are more expensive than ARX, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.2 | ||
| EV/EBITDA | 6.03 |
4.3 Compensation for Growth
ARX has an outstanding profitability rating, which may justify a higher PE ratio.
ARX's earnings are expected to grow with 14.21% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)0.34
EPS Next 2Y11.47%
EPS Next 3Y14.21%
5. Dividend
5.1 Amount
ARX has a Yearly Dividend Yield of 2.98%.
Compared to an average industry Dividend Yield of 6.47, ARX has a dividend in line with its industry peers.
ARX's Dividend Yield is a higher than the S&P500 average which is at 2.26.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.98% |
5.2 History
The dividend of ARX has a limited annual growth rate of 1.37%.
ARX has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of ARX decreased in the last 3 years.
Dividend Growth(5Y)1.37%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
ARX pays out 35.11% of its income as dividend. This is a sustainable payout ratio.
ARX's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP35.11%
EPS Next 2Y11.47%
EPS Next 3Y14.21%
ARC RESOURCES LTD
TSX:ARX (9/17/2024, 7:00:00 PM)
23.39
+0.24 (+1.04%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap13.97B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.98% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.99 | ||
| Fwd PE | 6.77 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)0.34
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 9.27% | ||
| ROE | 15.31% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 25.32% | ||
| PM (TTM) | 22.29% | ||
| GM | 68.97% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.3 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.88 | ||
| Quick Ratio | 0.88 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-47.29%
EPS 3Y73.75%
EPS 5Y
EPS Q2Q%
EPS Next Y-11.51%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-27.01%
Revenue growth 3Y70.91%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y