ARC RESOURCES LTD (ARX.CA) Stock Fundamental Analysis
Canada - TSX:ARX - CA00208D4084 - Common Stock
24.29 CAD
+0.26 (+1.08%)
Taking everything into account, ARX scores 8 out of 10 in our fundamental rating. ARX was compared to 216 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. ARX is evaluated to be cheap and growing strongly. This does not happen too often! These ratings would make ARX suitable for value and growth investing!
1. Profitability
1.1 Basic Checks
In the past year ARX was profitable.
ARX had a positive operating cash flow in the past year.
ARX had positive earnings in 4 of the past 5 years.
In the past 5 years ARX always reported a positive cash flow from operatings.
1.2 Ratios
The Return On Assets of ARX (10.58%) is better than 93.12% of its industry peers.
ARX has a Return On Equity of 18.08%. This is amongst the best in the industry. ARX outperforms 91.28% of its industry peers.
ARX has a better Return On Invested Capital (10.19%) than 92.20% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for ARX is significantly above the industry average of 6.93%.
The last Return On Invested Capital (10.19%) for ARX is well below the 3 year average (16.99%), which needs to be investigated, but indicates that ARX had better years and this may not be a problem.
| 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 86.70% of its industry peers.
In the last couple of years the Profit Margin of ARX has grown nicely.
The Operating Margin of ARX (29.11%) is better than 80.73% of its industry peers.
In the last couple of years the Operating Margin of ARX has grown nicely.
The Gross Margin of ARX (69.84%) is better than 89.91% 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 | 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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ARX is creating value.
Compared to 1 year ago, ARX has less shares outstanding
Compared to 5 years ago, ARX has more shares outstanding
ARX has a worse debt/assets ratio than last year.
2.2 Solvency
ARX has an Altman-Z score of 2.47. 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.
ARX has a Altman-Z score of 2.47. This is in the better half of the industry: ARX outperforms 75.23% of its industry peers.
ARX has a debt to FCF ratio of 2.58. This is a good value and a sign of high solvency as ARX would need 2.58 years to pay back of all of its debts.
ARX has a Debt to FCF ratio of 2.58. This is amongst the best in the industry. ARX outperforms 86.70% of its industry peers.
A Debt/Equity ratio of 0.29 indicates that ARX is not too dependend on debt financing.
ARX's Debt to Equity ratio of 0.29 is fine compared to the rest of the industry. ARX outperforms 60.55% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 2.58 | ||
| Altman-Z | 2.47 |
ROIC/WACC1.31
WACC7.77%
2.3 Liquidity
A Current Ratio of 1.21 indicates that ARX should not have too much problems paying its short term obligations.
ARX has a Current ratio of 1.21. This is in the better half of the industry: ARX outperforms 65.14% of its industry peers.
ARX has a Quick Ratio of 1.20. This is a normal value and indicates that ARX is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of ARX (1.20) is better than 70.64% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.21 | ||
| Quick Ratio | 1.2 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 31.44% over the past year.
The Earnings Per Share has been growing by 14.78% on average over the past years. This is quite good.
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.
ARX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.69% yearly.
EPS Next Y51.36%
EPS Next 2Y32.25%
EPS Next 3Y33.29%
EPS Next 5Y24.35%
Revenue Next Year17.97%
Revenue Next 2Y11.98%
Revenue Next 3Y7.62%
Revenue Next 5Y7.69%
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
With a Price/Earnings ratio of 9.53, the valuation of ARX can be described as very reasonable.
ARX's Price/Earnings ratio is a bit cheaper when compared to the industry. ARX is cheaper than 69.72% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 27.30. ARX is valued rather cheaply when compared to this.
With a Price/Forward Earnings ratio of 7.35, the valuation of ARX can be described as very cheap.
ARX's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. ARX is cheaper than 77.06% of the companies in the same industry.
ARX's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 22.73.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.53 | ||
| Fwd PE | 7.35 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, ARX is valued cheaper than 85.32% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, ARX is valued a bit cheaper than 72.02% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.4 | ||
| EV/EBITDA | 5.25 |
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.
The excellent profitability rating of ARX may justify a higher PE ratio.
ARX's earnings are expected to grow with 33.29% in the coming years. This may justify a more expensive valuation.
PEG (NY)0.19
PEG (5Y)N/A
EPS Next 2Y32.25%
EPS Next 3Y33.29%
5. Dividend
5.1 Amount
ARX has a Yearly Dividend Yield of 3.16%.
In the last 3 months the price of ARX has falen by -20.75%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 5.90, ARX pays a bit more dividend than its industry peers.
ARX's Dividend Yield is a higher than the S&P500 average which is at 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.16% |
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
28.39% of the earnings are spent on dividend by ARX. This is a low number and sustainable payout ratio.
ARX's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP28.39%
EPS Next 2Y32.25%
EPS Next 3Y33.29%
TSX:ARX (9/12/2025, 7:00:00 PM)
24.29
+0.26 (+1.08%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners39.56%
Inst Owner ChangeN/A
Ins Owners0.42%
Ins Owner ChangeN/A
Market Cap14.12B
Analysts83.48
Price Target34.75 (43.06%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.16% |
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)-0.76%
PT rev (3m)0.46%
EPS NQ rev (1m)-25.49%
EPS NQ rev (3m)-21.38%
EPS NY rev (1m)-12.57%
EPS NY rev (3m)-12.57%
Revenue NQ rev (1m)-2.33%
Revenue NQ rev (3m)-10.78%
Revenue NY rev (1m)0.78%
Revenue NY rev (3m)4.45%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.53 | ||
| Fwd PE | 7.35 | ||
| P/S | 2.47 | ||
| P/FCF | 12.4 | ||
| P/OCF | 4.9 | ||
| P/B | 1.7 | ||
| P/tB | 1.75 | ||
| EV/EBITDA | 5.25 |
EPS(TTM)2.55
EY10.5%
EPS(NY)3.31
Fwd EY13.61%
FCF(TTM)1.96
FCFY8.07%
OCF(TTM)4.96
OCFY20.4%
SpS9.83
BVpS14.27
TBVpS13.84
PEG (NY)0.19
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 | 2.47 |
F-Score8
WACC7.77%
ROIC/WACC1.31
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 2Y32.25%
EPS Next 3Y33.29%
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 2Y11.98%
Revenue Next 3Y7.62%
Revenue Next 5Y7.69%
EBIT growth 1Y25.39%
EBIT growth 3Y-15.42%
EBIT growth 5Y64.86%
EBIT Next Year176.6%
EBIT Next 3Y40.65%
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%