ARKO Corp (ARKO) AI Stock Analysis

• Market Cap: $564.84M
• Dividend Yield: 2.33%
• Average Volume (3M): 346.19K
• Price to Earnings (P/E): 64.6
• Beta (1Y): 1.25
• Revenue Growth: -13.05%
• EPS Growth: -68.59%
• Country: US
• Employees: 11,772
• Sector: Consumer Cyclical
• Sector Strength: 75
• Industry: Specialty Retail
• EPS (TTM): 0.16
• Shares Outstanding: 112,742,340
• 10 Day Avg. Volume: 437,614
• 30 Day Avg. Volume: 346,187
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 5.09
• Enterprise Value/Revenue: 0.35
• Enterprise Value/Gross Profit: 5.53
• Enterprise Value/Ebitda: 11.20
• 1Y Price Target: $6.00
• Price Target Upside: 16.28% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 62 Neutral
• Price Target: $5.00 ▼(-3.10% Downside)

ARKO's overall stock score reflects a combination of strong cash flow management and operational efficiency, offset by high leverage and valuation concerns. Technical indicators suggest a bearish trend, while the earnings call and corporate events provide a mixed outlook with both positive developments and challenges.

Positive Factors

Guidance and Trends

Management reiterated 2025 guidance, suggesting a stabilization of ARKO trends and expectations.

Profitability

Merch and Fuel profitability came largely in line, with upside to our model due to better expense management.

Stabilization of Expectations

Expectations, although low, have stabilized which is a positive for ARKO.

Negative Factors

Risk of Deterioration

There is a risk that ARKO's dealerization benefits may deteriorate over time.

Strategy Visibility

Lack of visibility from ARKO's continually evolving strategy justifies continued caution.

Valuation Concerns

There is a risk that ARKO's valuation remains subdued relative to peers if volumes, particularly retail fuel volumes and same-store merchandise sales, remain weaker than peers and industry data.

ARKO Corp Business Overview & Revenue Model

Company Description

Arko Corp. operates convenience stores in the United States. It operates through three segments: Retail, Wholesale, and GPM Petroleum. The Retail segment engages in the sale of fuel and merchandise to retail consumers. The Wholesale segment supplies fuel to third-party dealers and consignment agents. The GPM Petroleum segment supplies fuel to independent dealers, and bulk and spot purchasers. It operates approximately 3,000 locations comprising approximately 1,400 company-operated stores and approximately 1,650 dealer sites. The company is based in Richmond, Virginia.

How the Company Makes Money

ARKO Corp generates revenue through multiple streams, primarily from the sale of fuel and merchandise at its convenience store locations. The company earns a significant portion of its income from fuel sales, benefitting from both the direct sale of gasoline and related products, as well as through strategic partnerships with fuel suppliers and distributors. Additionally, ARKO Corp generates revenue from the sale of a wide range of retail products, including groceries, snacks, beverages, and prepared foods. The company also engages in franchising, earning fees and royalties from franchisees who operate stores under its various regional brands. These diverse revenue streams, combined with efficiencies in supply chain and operations, contribute to the company's overall profitability and financial performance.

ARKO Corp Financial Statement Overview

Summary

ARKO Corp shows strengths in cash flow management and operational efficiency, but faces challenges with high leverage and low profitability margins. While revenue growth is inconsistent, the company maintains a stable financial position with a focus on improving cash conversion and supporting growth through healthy free cash flows.

Income Statement

ARKO's revenue growth has been inconsistent, with a recent decline in TTM compared to the previous year. The gross profit margin for TTM stands at 6.19%, showing a slight improvement. However, the net profit margin is low at 0.30%. EBIT and EBITDA margins are moderate at 1.07% and 2.86% respectively, indicating stable operational efficiency.

Balance Sheet

The company's debt-to-equity ratio is high at 7.22, suggesting significant leverage, which poses financial risk. However, the equity ratio of 9.86% indicates some level of equity backing. The return on equity is relatively low at 7.13%, reflecting modest returns for shareholders.

Cash Flow

ARKO demonstrates strong cash flow management, with a significant free cash flow growth rate of 30.09% in TTM. The operating cash flow to net income ratio is robust at 9.98, indicating efficient cash conversion. Free cash flow to net income ratio is healthy at 5.55, supporting future growth investments.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	8.10B	8.73B	9.41B	9.14B	7.42B	3.91B
Gross Profit	519.63M	397.22M	423.63M	418.55M	367.48M	258.36M
EBITDA	256.72M	256.63M	265.88M	269.51M	235.68M	155.68M
Net Income	31.35M	20.84M	34.37M	71.75M	59.20M	31.39M
Balance Sheet
Total Assets	3.61B	3.62B	3.65B	3.26B	2.94B	2.74B
Cash, Cash Equivalents and Short-Term Investments	299.66M	267.09M	222.01M	300.93M	310.95M	293.67M
Total Debt	2.61B	2.58B	2.53B	2.26B	2.08B	2.01B
Total Liabilities	3.24B	3.24B	3.27B	2.87B	2.59B	2.42B
Stockholders Equity	364.83M	376.87M	376.10M	380.83M	353.45M	318.04M
Cash Flow
Free Cash Flow	82.49M	107.94M	24.89M	110.48M	-67.26M	129.17M
Operating Cash Flow	175.29M	221.86M	136.09M	209.26M	159.19M	173.84M
Investing Cash Flow	-89.11M	-114.86M	-296.82M	-175.49M	-171.78M	-407.55M
Financing Cash Flow	-47.70M	-56.00M	85.36M	10.55M	-26.38M	491.05M

ARKO Corp Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.16
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARKO, the sentiment is Positive. The current price of 5.16 is above the 20-day moving average (MA) of 4.47, above the 50-day MA of 4.47, and below the 200-day MA of 5.37, indicating a neutral trend. The MACD of 0.11 indicates Negative momentum. The RSI at 68.19 is Neutral, neither overbought nor oversold. The STOCH value of 91.38 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ARKO.

ARKO Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CASY	77 Outperform	$19.32B	35.51	16.75%	0.40%	7.25%	9.12%
GPC	72 Outperform	$18.74B	23.21	17.50%	2.94%	2.65%	-32.91%
ASO	72 Outperform	$3.46B	9.58	20.14%	0.87%	-3.57%	-17.43%
Sector *	67 Neutral	¥277.27B	14.70	6.81%	2.50%	5.06%	-23.65%
ARKO	62 Neutral	$564.84M	64.56	4.01%	2.33%	-13.05%	-68.59%
AAP	54 Neutral	$3.54B	59.62	-24.78%	1.62%	-16.55%	-941.57%
GME	54 Neutral	$10.26B	49.91	6.62%	―	-25.30%	479.26%

ARKO Corp Corporate Events

ARKO Corp Reports Q2 2025 Net Income Increase

In the second quarter of 2025, ARKO Corp. reported a net income increase to $20.1 million and a merchandise margin rise to 33.6%, despite a decrease in adjusted EBITDA and merchandise contribution compared to the previous year. The company continued its transformation plan by converting 70 retail stores to dealer sites and opening new format stores to enhance customer experience, aiming for significant operational income benefits and structural savings.

The most recent analyst rating on (ARKO) stock is a Buy with a $10.00 price target. To see the full list of analyst forecasts on ARKO Corp stock, see the ARKO Stock Forecast page.

ARKO Corp Concludes 2025 Annual Stockholders Meeting

ARKO Corp held its 2025 Annual Meeting of Stockholders on June 5, 2025, where several key proposals were voted on. The election of six directors to the Board was confirmed, with Sherman K. Edmiston III, Avram Friedman, Andrew R. Heyer, Steven J. Heyer, Laura Shapira Karet, and Arie Kotler being elected to hold office until the 2026 Annual Meeting. Additionally, stockholders approved a non-binding advisory resolution on executive compensation and ratified the appointment of Grant Thornton, LLP as the independent registered public accounting firm for the 2025 fiscal year. However, a proposal to amend the company’s governing documents for majority vote in uncontested elections was not approved.

The most recent analyst rating on (ARKO) stock is a Buy with a $8.50 price target. To see the full list of analyst forecasts on ARKO Corp stock, see the ARKO Stock Forecast page.

ARKO Corp Expands Real Estate Financing Agreement

On May 13, 2025, GPM Investments, a subsidiary of ARKO Corp., amended its credit and covenant agreements with M&T Bank, increasing its real estate loan principal from $49.5 million to $83.7 million. This amendment allows GPM to secure additional financing for real estate, with the loans maturing in 2030, and offers flexible interest rate options, potentially enhancing its operational capabilities and financial stability.

The most recent analyst rating on (ARKO) stock is a Buy with a $10.00 price target. To see the full list of analyst forecasts on ARKO Corp stock, see the ARKO Stock Forecast page.