Archrock’s Growth Potential and Financial Stability Justify Buy Rating

Doug Irwin, an analyst from Citi, reiterated the Buy rating on Archrock (AROC – Research Report). The associated price target is $33.00.

Doug Irwin has given his Buy rating due to a combination of factors that highlight Archrock’s potential for growth and financial stability. One of the primary reasons is the company’s increased cash flow estimates, which are driven by higher-than-expected EBITDA guidance for 2025. This guidance surpasses previous estimates, indicating strong financial performance bolstered by favorable capital expenditure and pricing conditions.
Additionally, Archrock’s strategic acquisition of Natural Gas Compression Systems for $357 million is expected to be immediately beneficial to earnings per share and cash available for dividends. This acquisition not only enhances Archrock’s presence in the Permian region but also promises to be accretive to financial metrics even before realizing potential synergies. With a well-managed balance sheet and a clear path to growth, including significant capital expenditures and fleet expansions, Irwin views Archrock as well-positioned to capitalize on compression demand, justifying the Buy rating.

In another report released on March 12, Evercore ISI also reiterated a Buy rating on the stock with a $32.00 price target.