ARKO Corp (ARKO) AI Stock Analysis

• Market Cap: $517.49M
• Dividend Yield: 2.61%
• Average Volume (3M): 553.15K
• Price to Earnings (P/E): 59.5
• Beta (1Y): 1.31
• Revenue Growth: -13.05%
• EPS Growth: -68.59%
• Country: US
• Employees: 11,772
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Specialty Retail
• EPS (TTM): 0.16
• Shares Outstanding: 112,742,340
• 10 Day Avg. Volume: 623,586
• 30 Day Avg. Volume: 553,155
• 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: 5.55
• Enterprise Value/Revenue: 0.35
• Enterprise Value/Gross Profit: 5.53
• Enterprise Value/Ebitda: 11.20
• 1Y Price Target: $6.50
• Price Target Upside: 41.61% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

• Rating: 64 Neutral
• Price Target: $5.00 ▲(8.93% Upside)

ARKO's overall stock score is driven by strong cash flow management and operational efficiency. However, high leverage and low profitability margins pose risks. The earnings call provided a mixed outlook, with positive initiatives offset by declining sales and EBITDA. The technical analysis suggests potential bearish momentum, and the high P/E ratio indicates overvaluation.

Positive Factors

Cash Flow Management

Strong cash flow management supports ARKO's ability to invest in growth opportunities and maintain financial stability, crucial for long-term success.

Dealerization Program

The dealerization program enhances operational efficiency and profitability, providing a structural boost to ARKO's income potential.

Loyalty Program Growth

Growth in the loyalty program increases customer retention and spending, strengthening ARKO's competitive position and revenue base.

Negative Factors

High Leverage

High leverage can limit ARKO's financial flexibility and increase risk, potentially impacting its ability to invest in growth and weather downturns.

Decline in Same-Store Sales

Declining same-store sales indicate challenges in maintaining customer traffic and sales volume, which could pressure future revenue growth.

Low Profitability Margins

Low profitability margins suggest limited pricing power and cost management challenges, which may hinder ARKO's ability to improve earnings.

ARKO Corp Business Overview & Revenue Model

Company Description

ARKO Corp (ARKO) is a prominent player in the convenience store and fuel retailing sectors, operating a network of convenience stores and gas stations across the United States. The company is known for its strategic acquisitions and partnerships, enhancing its footprint and market share in the highly competitive retail landscape. ARKO's core offerings include a wide range of convenience store products, fuel services, and food service options, catering to the needs of on-the-go consumers.

How the Company Makes Money

ARKO Corp generates revenue primarily through the sale of fuel and convenience store merchandise. The company operates a vast network of convenience stores that sell a variety of products including groceries, snacks, beverages, and prepared food items. Fuel sales contribute significantly to ARKO's revenue, with a pricing strategy that reflects market conditions. Additionally, ARKO has established partnerships with various brands for exclusive product offerings and promotions, enhancing its appeal to customers. The company's revenue is bolstered by its ability to optimize operational efficiencies and leverage economies of scale through its extensive store network and ongoing acquisitions.

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: Negative
• Last Price: 4.59
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

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 4.59 is below the 20-day moving average (MA) of 4.93, below the 50-day MA of 4.76, and below the 200-day MA of 5.07, indicating a bearish trend. The MACD of -0.04 indicates Positive momentum. The RSI at 39.36 is Neutral, neither overbought nor oversold. The STOCH value of 12.50 is Positive, 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
CASY	75 Outperform	20.36B	34.87	15.98%	0.38%	8.74%	13.37%
ASO	73 Outperform	3.32B	8.95	17.87%	1.00%	-2.20%	-17.95%
GPC	67 Neutral	19.15B	23.47	17.20%	2.97%	2.65%	-32.91%
ARKO	64 Neutral	$517.49M	59.54	4.01%	2.61%	-13.05%	-68.59%
GME	64 Neutral	11.83B	36.12	6.95%	―	-15.48%	528.37%
AAP	54 Neutral	3.66B	-9.54	-15.47%	1.64%	-22.50%	-35219.23%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%

ARKO Corp Corporate Events

ARKO Corp CFO Departure Announcement on August 12

On August 12, 2025, ARKO Corp. announced that its Executive Vice President and Chief Financial Officer, Robert (Robb) Giammatteo, will be leaving the company on October 10, 2025, to pursue another opportunity. Giammatteo has assured a smooth transition and clarified that his departure is not due to any disagreements with the company regarding financial, operational, or policy matters.

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.