ARC RESOURCES LTD (ARX.CA) Stock Fundamental Analysis
Canada - TSX:ARX - CA00208D4084 - Common Stock
25.58 CAD
-0.39 (-1.5%)
We assign a fundamental rating of 8 out of 10 to ARX. ARX was compared to 210 industry peers in the Oil, Gas & Consumable Fuels industry. While ARX has a great profitability rating, there are some minor concerns on its financial health. ARX has both an excellent growth and valuation score. This means it is growing and it is still cheap. This is a rare combination! These ratings could make ARX a good candidate for value and growth investing.
1. Profitability
1.1 Basic Checks
ARX had positive earnings in the past year.
ARX had a positive operating cash flow in the past year.
ARX had positive earnings in 4 of the past 5 years.
ARX had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
The Return On Assets of ARX (10.58%) is better than 92.86% of its industry peers.
Looking at the Return On Equity, with a value of 18.08%, ARX belongs to the top of the industry, outperforming 91.43% of the companies in the same industry.
With an excellent Return On Invested Capital value of 10.19%, ARX belongs to the best of the industry, outperforming 92.38% of the companies in the same industry.
ARX had an Average Return On Invested Capital over the past 3 years of 16.99%. This is significantly above the industry average of 6.85%.
The 3 year average ROIC (16.99%) for ARX is well above the current ROIC(10.19%). The reason for the recent decline needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.58% | ||
| ROE | 18.08% | ||
| ROIC | 10.19% |
ROA(3y)13.76%
ROA(5y)7.43%
ROE(3y)23.41%
ROE(5y)12.78%
ROIC(3y)16.99%
ROIC(5y)13.58%
1.3 Margins
ARX has a better Profit Margin (26.24%) than 85.71% of its industry peers.
ARX's Profit Margin has improved in the last couple of years.
ARX has a Operating Margin of 29.11%. This is amongst the best in the industry. ARX outperforms 80.48% of its industry peers.
In the last couple of years the Operating Margin of ARX has grown nicely.
ARX has a Gross Margin of 69.84%. This is amongst the best in the industry. ARX outperforms 89.05% of its industry peers.
ARX's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.11% | ||
| PM (TTM) | 26.24% | ||
| GM | 69.84% |
OM growth 3Y-15.37%
OM growth 5Y23.89%
PM growth 3Y12.7%
PM growth 5YN/A
GM growth 3Y-2.53%
GM growth 5Y-0.87%
2. Health
2.1 Basic Checks
ARX has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, ARX has less shares outstanding
ARX has more shares outstanding than it did 5 years ago.
The debt/assets ratio for ARX is higher compared to a year ago.
2.2 Solvency
ARX has an Altman-Z score of 2.55. This is not the best score and indicates that ARX is in the grey zone with still only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.55, ARX is doing good in the industry, outperforming 73.81% of the companies in the same industry.
The Debt to FCF ratio of ARX is 2.58, which is a good value as it means it would take ARX, 2.58 years of fcf income to pay off all of its debts.
ARX has a Debt to FCF ratio of 2.58. This is amongst the best in the industry. ARX outperforms 87.14% of its industry peers.
ARX has a Debt/Equity ratio of 0.29. This is a healthy value indicating a solid balance between debt and equity.
ARX has a Debt to Equity ratio (0.29) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.58 | ||
| Altman-Z | 2.55 |
ROIC/WACC1.32
WACC7.74%
2.3 Liquidity
ARX has a Current Ratio of 1.21. This is a normal value and indicates that ARX is financially healthy and should not expect problems in meeting its short term obligations.
ARX has a Current ratio of 1.21. This is in the better half of the industry: ARX outperforms 64.76% of its industry peers.
A Quick Ratio of 1.20 indicates that ARX should not have too much problems paying its short term obligations.
The Quick ratio of ARX (1.20) is better than 69.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
ARX shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 31.44%, which is quite impressive.
Measured over the past years, ARX shows a quite strong growth in Earnings Per Share. The EPS has been growing by 14.78% on average per year.
Looking at the last year, ARX shows a quite strong growth in Revenue. The Revenue has grown by 9.09% in the last year.
The Revenue has been growing by 33.07% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)31.44%
EPS 3Y14.78%
EPS 5YN/A
EPS Q2Q%70%
Revenue 1Y (TTM)9.09%
Revenue growth 3Y-0.06%
Revenue growth 5Y33.07%
Sales Q2Q%35.68%
3.2 Future
Based on estimates for the next years, ARX will show a very strong growth in Earnings Per Share. The EPS will grow by 24.35% on average per year.
The Revenue is expected to grow by 8.04% on average over the next years. This is quite good.
EPS Next Y51.36%
EPS Next 2Y32.35%
EPS Next 3Y33.59%
EPS Next 5Y24.35%
Revenue Next Year17.97%
Revenue Next 2Y11.52%
Revenue Next 3Y7.42%
Revenue Next 5Y8.04%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
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
With a Price/Earnings ratio of 10.03, the valuation of ARX can be described as very reasonable.
68.57% of the companies in the same industry are more expensive than ARX, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.50. ARX is valued rather cheaply when compared to this.
A Price/Forward Earnings ratio of 7.73 indicates a rather cheap valuation of ARX.
Based on the Price/Forward Earnings ratio, ARX is valued a bit cheaper than 73.33% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of ARX to the average of the S&P500 Index (22.99), we can say ARX is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.03 | ||
| Fwd PE | 7.73 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ARX indicates a rather cheap valuation: ARX is cheaper than 85.71% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, ARX is valued a bit cheaper than the industry average as 70.00% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13.05 | ||
| EV/EBITDA | 5.5 |
4.3 Compensation for Growth
ARX's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
ARX has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as ARX's earnings are expected to grow with 33.59% in the coming years.
PEG (NY)0.2
PEG (5Y)N/A
EPS Next 2Y32.35%
EPS Next 3Y33.59%
5. Dividend
5.1 Amount
ARX has a Yearly Dividend Yield of 2.87%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 7.51, ARX pays a bit more dividend than its industry peers.
ARX's Dividend Yield is comparable with the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
5.2 History
The dividend of ARX has a limited annual growth rate of 2.59%.
ARX has been paying a dividend for at least 10 years, so it has a reliable track record.
ARX has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)2.59%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
ARX pays out 28.39% of its income as dividend. This is a sustainable payout ratio.
The dividend of ARX is growing, but earnings are growing more, so the dividend growth is sustainable.
DP28.39%
EPS Next 2Y32.35%
EPS Next 3Y33.59%
TSX:ARX (10/14/2025, 7:00:00 PM)
25.58
-0.39 (-1.5%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners41.5%
Inst Owner ChangeN/A
Ins Owners0.43%
Ins Owner ChangeN/A
Market Cap14.87B
Analysts83.48
Price Target34.43 (34.6%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.87% |
Yearly Dividend0.68
Dividend Growth(5Y)2.59%
DP28.39%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)16.52%
Min EPS beat(2)-6.74%
Max EPS beat(2)39.77%
EPS beat(4)3
Avg EPS beat(4)27.75%
Min EPS beat(4)-6.74%
Max EPS beat(4)57.44%
EPS beat(8)5
Avg EPS beat(8)19.88%
EPS beat(12)9
Avg EPS beat(12)29.45%
EPS beat(16)11
Avg EPS beat(16)16.61%
Revenue beat(2)2
Avg Revenue beat(2)12.95%
Min Revenue beat(2)12.52%
Max Revenue beat(2)13.38%
Revenue beat(4)4
Avg Revenue beat(4)9.41%
Min Revenue beat(4)3.66%
Max Revenue beat(4)13.38%
Revenue beat(8)8
Avg Revenue beat(8)12.74%
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-0.92%
PT rev (3m)-0.93%
EPS NQ rev (1m)-0.2%
EPS NQ rev (3m)-15.74%
EPS NY rev (1m)0%
EPS NY rev (3m)-12.57%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-2.65%
Revenue NY rev (1m)0%
Revenue NY rev (3m)4.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.03 | ||
| Fwd PE | 7.73 | ||
| P/S | 2.6 | ||
| P/FCF | 13.05 | ||
| P/OCF | 5.16 | ||
| P/B | 1.79 | ||
| P/tB | 1.85 | ||
| EV/EBITDA | 5.5 |
EPS(TTM)2.55
EY9.97%
EPS(NY)3.31
Fwd EY12.94%
FCF(TTM)1.96
FCFY7.66%
OCF(TTM)4.96
OCFY19.37%
SpS9.83
BVpS14.27
TBVpS13.84
PEG (NY)0.2
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 10.58% | ||
| ROE | 18.08% | ||
| ROCE | 13.16% | ||
| ROIC | 10.19% | ||
| ROICexc | 11.01% | ||
| ROICexgc | 11.25% | ||
| OM | 29.11% | ||
| PM (TTM) | 26.24% | ||
| GM | 69.84% | ||
| FCFM | 19.93% |
ROA(3y)13.76%
ROA(5y)7.43%
ROE(3y)23.41%
ROE(5y)12.78%
ROIC(3y)16.99%
ROIC(5y)13.58%
ROICexc(3y)17.05%
ROICexc(5y)13.61%
ROICexgc(3y)17.46%
ROICexgc(5y)13.96%
ROCE(3y)21.94%
ROCE(5y)17.54%
ROICexcg growth 3Y-21.36%
ROICexcg growth 5Y39.3%
ROICexc growth 3Y-21.23%
ROICexc growth 5Y40.04%
OM growth 3Y-15.37%
OM growth 5Y23.89%
PM growth 3Y12.7%
PM growth 5YN/A
GM growth 3Y-2.53%
GM growth 5Y-0.87%
F-Score8
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.58 | ||
| Debt/EBITDA | 0.79 | ||
| Cap/Depr | 124.06% | ||
| Cap/Sales | 30.48% | ||
| Interest Coverage | 15.25 | ||
| Cash Conversion | 93.92% | ||
| Profit Quality | 75.96% | ||
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 | ||
| Altman-Z | 2.55 |
F-Score8
WACC7.74%
ROIC/WACC1.32
Cap/Depr(3y)124.75%
Cap/Depr(5y)99.95%
Cap/Sales(3y)28.25%
Cap/Sales(5y)26.97%
Profit Quality(3y)61.71%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)31.44%
EPS 3Y14.78%
EPS 5YN/A
EPS Q2Q%70%
EPS Next Y51.36%
EPS Next 2Y32.35%
EPS Next 3Y33.59%
EPS Next 5Y24.35%
Revenue 1Y (TTM)9.09%
Revenue growth 3Y-0.06%
Revenue growth 5Y33.07%
Sales Q2Q%35.68%
Revenue Next Year17.97%
Revenue Next 2Y11.52%
Revenue Next 3Y7.42%
Revenue Next 5Y8.04%
EBIT growth 1Y25.39%
EBIT growth 3Y-15.42%
EBIT growth 5Y64.86%
EBIT Next Year177.53%
EBIT Next 3Y45.5%
EBIT Next 5YN/A
FCF growth 1Y-19.97%
FCF growth 3Y-18.47%
FCF growth 5YN/A
OCF growth 1Y-6.24%
OCF growth 3Y5.39%
OCF growth 5Y29.74%