ARKO Corp (ARKO) AI Stock Analysis

• Market Cap: $534.45M
• Dividend Yield: 2.54%
• Average Volume (3M): 536.33K
• Price to Earnings (P/E): 197.1
• Beta (1Y): 1.03
• Revenue Growth: -9.67%
• EPS Growth: -89.84%
• Country: US
• Employees: 11,772
• Sector: Consumer Cyclical
• Sector Strength: 76
• Industry: Specialty Retail
• EPS (TTM): -0.12
• Shares Outstanding: 113,954,880
• 10 Day Avg. Volume: 721,657
• 30 Day Avg. Volume: 536,327
• PEG Ratio: -0.70
• Price to Book (P/B): 1.47
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 5.07
• Enterprise Value/Market Cap: 5.37
• Enterprise Value/Revenue: 0.08
• Enterprise Value/Gross Profit: 7.89
• Enterprise Value/Ebitda: 2.74
• 1Y Price Target: $7.00
• Price Target Upside: 49.25% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5

• Rating: 65 Neutral
• Price Target: $5.00 ▲( 6.61% Upside)

ARKO Corp's overall stock score reflects stable financial performance with effective cost management and a healthy balance sheet, but significant challenges in revenue growth and profitability detract from its appeal. Technical indicators are mixed, and high valuation multiples pose additional risks. Corporate events show strategic expansion efforts, but recent earnings reveal financial pressures, resulting in an overall neutral sentiment.

Positive Factors

Dealerization Strategy

ARKO's dealerization strategy is expected to bring more than $20 million in annualized benefits.

Expectations

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

Financial Performance

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

Negative Factors

Growth Uncertainty

Growth plans include a remodel pilot where ARKO has a limited track record, and it may take years before it seriously impacts ARKO.

Strategic Visibility

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

Valuation Risks

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 primarily through its extensive network of convenience stores and gas stations. The company earns money by selling fuel, which constitutes a significant portion of its income, and through the sale of convenience items such as snacks, beverages, and other everyday products. Additionally, ARKO benefits from partnerships and supplier agreements that allow it to offer a diverse range of products at competitive prices. The company's revenue model is also supported by strategic acquisitions that enhance its market presence and operational efficiencies, contributing to its overall earnings.

ARKO Corp Financial Statement Overview

Summary

ARKO Corp demonstrates a stable financial position with effective cost management. However, it faces challenges in revenue growth and profitability, with a low net profit margin and declining revenue. The balance sheet is strong with low leverage, but cash flow generation needs improvement.

Income Statement

ARKO Corp shows a solid gross profit margin of 100% for 2024, driven by efficient cost management. The net profit margin is relatively low at 0.38%, indicating limited profitability. Revenue growth is negative, with a decline of 7.24% from 2023 to 2024, reflecting challenges in maintaining sales momentum. EBIT and EBITDA margins are modest, at 1.08% and 0.70% respectively, suggesting room for operational efficiency improvements.

Balance Sheet

The company maintains a healthy balance sheet with a low debt-to-equity ratio of 0.31, indicating prudent financial leverage. Return on equity stands at 11.92%, showcasing decent returns for shareholders. The equity ratio is 7.65%, reflecting a stable capital structure but with potential for strengthening the equity base.

Cash Flow

Free cash flow growth from 2023 to 2024 is negative, showcasing a challenge in cash generation. The operating cash flow to net income ratio is 0.63, indicating moderate cash conversion efficiency. Free cash flow to net income ratio is 0.63 as well, suggesting limited free cash flow relative to earnings.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
8.73B	9.41B	9.14B	7.42B	3.91B
	Gross Profit
397.22M	423.63M	418.55M	367.48M	258.36M
	EBIT
94.03M	118.01M	167.01M	142.08M	80.31M
	EBITDA
256.63M	265.88M	269.51M	235.68M	155.68M
	Net Income Common Stockholders
20.84M	34.37M	71.75M	59.20M	31.39M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
267.09M	222.01M	300.93M	310.95M	293.67M
	Total Assets
3.62B	3.65B	3.26B	2.94B	2.74B
	Total Debt
2.58B	2.53B	2.26B	2.08B	2.01B
	Net Debt
2.32B	2.31B	1.96B	1.83B	1.71B
	Total Liabilities
3.24B	3.27B	2.87B	2.59B	2.42B
	Stockholders Equity
376.87M	376.10M	380.83M	353.45M	318.04M
Cash Flow		Free Cash Flow
107.94M	24.89M	110.48M	-67.26M	129.17M
	Operating Cash Flow
221.86M	136.09M	209.26M	159.19M	173.84M
	Investing Cash Flow
-114.86M	-296.82M	-175.49M	-171.78M	-407.55M
	Financing Cash Flow
-56.00M	85.36M	10.55M	-26.38M	491.05M

ARKO Corp Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.69
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARKO, the sentiment is Negative. The current price of 4.69 is above the 20-day moving average (MA) of 4.57, above the 50-day MA of 4.23, and below the 200-day MA of 5.93, indicating a neutral trend. The MACD of 0.20 indicates Negative momentum. The RSI at 52.95 is Neutral, neither overbought nor oversold. The STOCH value of 25.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARKO.

ARKO Corp Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MYE	67 Neutral	$456.81M	43.66	3.69%	4.47%	3.92%	-73.64%
AXL	65 Neutral	$519.74M	24.94	3.40%	―	-4.25%	―
ARKO	65 Neutral	$534.45M	197.06	2.45%	2.54%	-9.67%	-89.84%
Sector *	62 Neutral	$6.84B	11.22	2.83%	3.93%	2.65%	-21.93%
MNRO	55 Neutral	$410.91M	23.23	3.02%	9.05%	-5.25%	-42.25%
PACK	54 Neutral	$287.24M	―	-3.89%	―	10.11%	6.77%
DADA	49 Neutral	$546.84M	―	-44.36%	―	-13.54%	-3.33%

ARKO Corp Corporate Events

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.

ARKO Corp Reports Q1 2025 Net Loss of $12.7M

In the first quarter of 2025, ARKO Corp. reported a net loss of $12.7 million, a decline in merchandise and fuel contributions, and an increase in merchandise margin. The company is advancing its transformation strategy by converting retail stores to dealer sites, remodeling stores, and expanding its store network, which is expected to enhance customer experience and drive long-term shareholder returns.

ARKO Corp Reports Q4 2024 Net Loss Amid Transformation

ARKO Corp reported a net loss of $2.3 million for the fourth quarter of 2024, compared to a net income of $1.1 million in the same period the previous year. The company is undergoing a transformation plan, converting retail stores to dealer sites, and expects this to yield significant operating income benefits. Despite challenges, ARKO is focusing on operational efficiencies and strategic investments in high-growth areas to drive sustainable long-term growth.