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Ark Restaurants (ARKR)
NASDAQ:ARKR
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Ark Restaurants
(NASDAQ:ARKR)
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Rating:43Neutral
Price Target:
$7.00
▼(-1.82% Downside)
Ark Restaurants faces significant financial challenges, with declining revenues, high leverage, and negative cash flow trends being the most impactful factors. Technical indicators suggest a bearish trend, and the valuation is unattractive due to a negative P/E ratio and no dividend yield. While the earnings call provided some positive insights, such as a strong cash position and potential future opportunities, these are overshadowed by current operational difficulties.
Ark Restaurants (ARKR) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$25.96M
Dividend YieldN/A
Average Volume (3M)5.59K
Price to Earnings (P/E)―
Beta (1Y)0.22
Revenue Growth-6.89%
EPS Growth-42.75%
CountryUS
Employees1,246
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)-0.96
Shares Outstanding3,606,157
10 Day Avg. Volume6,903
30 Day Avg. Volume5,590
Financial Highlights & Ratios
PEG Ratio0.31
Price to Book (P/B)0.95
Price to Sales (P/S)0.23
P/FCF Ratio19.23
Enterprise Value/Market Cap4.14
Enterprise Value/Revenue0.63
Enterprise Value/Gross Profit2.43
Enterprise Value/Ebitda-37.70
Forecast
1Y Price Target
$7.00Price Target Upside-1.82% Downside
Rating ConsensusHold
Number of Analyst Covering1
Ark Restaurants Business Overview & Revenue Model
Company DescriptionArk Restaurants Corp., through its subsidiaries, owns and operates restaurants and bars in the United States. As of December 20, 2021, it owned and operated 17 restaurants and bars, including four restaurants located in New York City; one in Washington, D.C.; five in Las Vegas, Nevada; one in Atlantic City, New Jersey; four on the east coast of Florida; and two on the gulf coast of Alabama, as well as had 17 fast food concepts and catering operations. The company was incorporated in 1983 and is based in New York, New York.
How the Company Makes MoneyArk Restaurants generates revenue primarily through its network of restaurants and food service operations. Key revenue streams include sales from dining services, catering contracts, and food concessions. The company benefits from its strategic locations in high-traffic areas, which drive substantial foot traffic and customer engagement. Additionally, partnerships with entertainment venues, hotels, and casinos further enhance revenue opportunities, as these collaborations allow Ark Restaurants to tap into a steady flow of customers seeking dining options while attending events. Seasonal promotions and special events also contribute to revenue, as they attract both new and repeat customers.
Ark Restaurants Earnings Call Summary
Earnings Call Date:Aug 11, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Dec 22, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted a strong financial position and positive performance in specific restaurants, notably in Las Vegas and New York. However, these positives are tempered by significant challenges, including an impairment charge and visitor declines affecting some locations. The potential casino license presents a future opportunity, but current operational challenges remain substantial.Q3-2025 Updates
Positive Updates
Strong Balance Sheet
The company has a cash position of $12 million at the quarter end and a debt of $3.9 million. The credit agreement was extended through June 2028 with $20 million of capacity.
Individual Restaurant Performance
Las Vegas and New York restaurants are performing above expectations. Robert in New York and Rustic in Fort Lauderdale continue to do well despite a general slowdown in visitor numbers.
Potential Casino License Opportunity
There is optimism about obtaining a casino license in Meadowlands, New Jersey, as the state considers expanding gaming in the northern part of the state.
Negative Updates
Sequoia Leasehold Impairment
An additional impairment charge of $4.7 million was recorded for Sequoia's leasehold improvements due to a cash flow analysis.
Decline in Restaurant Visitors
There is a reported 15% to 20% decline in headcounts and visitorship in some areas, particularly affecting restaurants in Florida.
Challenges at Sequoia and Bryant Park
Sequoia in Washington, D.C. is suffering from low visitor numbers and a decline in its event business. Bryant Park is facing litigation issues, with a long legal process anticipated.
Company Guidance
During the Ark Restaurants Third Quarter 2025 Results Conference Call, the company provided several key metrics and insights into its financial health and operational performance. The balance sheet showed $12 million in cash and $3.9 million in debt, with a credit agreement extended through June 1, 2028, offering $20 million of capacity. The company also reported a $4.7 million impairment on Sequoia's leasehold improvements and right-of-use assets. Despite a general decline in visitor numbers, Las Vegas operations continue to perform well, and restaurants like Robert in New York and Rustic in Fort Lauderdale are exceeding expectations. Meanwhile, challenges persist at Sequoia in Washington, D.C., due to a drop in event business, and at Bryant Park, where the company is engaged in litigation. Additionally, Ark Restaurants sees potential opportunities with a possible casino license for Meadowlands, contingent on New Jersey's legislative moves following New York's casino license announcements.Ark Restaurants Financial Statement Overview
Summary
Ark Restaurants is facing financial challenges across all verticals. The income statement reflects declining revenues and profitability issues, while the balance sheet shows high leverage and negative returns on equity. Cash flow analysis indicates significant declines in free cash flow, raising concerns about liquidity and financial stability. The company needs to address these issues to improve its financial health.Income Statement
Ark Restaurants has faced declining revenue growth, with a negative growth rate of -3.74% in the TTM period. The company is struggling with profitability, as indicated by negative net profit and EBIT margins. The gross profit margin has also decreased compared to previous years, reflecting challenges in maintaining cost efficiency.45
Neutral
Balance Sheet
The company has a high debt-to-equity ratio of 2.52 in the TTM period, indicating significant leverage and potential financial risk. Return on equity is negative, suggesting inefficiencies in generating returns for shareholders. The equity ratio is not explicitly calculated, but the high debt levels imply limited equity relative to total assets.40
Negative
Cash Flow
Ark Restaurants has experienced a significant decline in free cash flow, with a growth rate of -408.70% in the TTM period. The operating cash flow to net income ratio is low, indicating challenges in converting earnings into cash. The negative free cash flow to net income ratio further highlights cash flow constraints.35
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2019 | Dec 2018 | Dec 2017 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 171.83M | 183.54M | 184.79M | 162.35M | 159.99M | 153.88M |
| Gross Profit | 44.22M | 68.18M | 17.57M | 62.24M | 61.33M | 59.21M |
| EBITDA | -2.85M | 591.00K | 634.00K | 8.54M | 10.16M | 11.32M |
| Net Income | -14.01M | -3.90M | -5.93M | 2.68M | 4.66M | 4.04M |
Balance Sheet | ||||||
| Total Assets | 136.34M | 156.04M | 176.96M | 94.65M | 84.74M | 80.07M |
| Cash, Cash Equivalents and Short-Term Investments | -21.00K | 10.27M | 13.41M | 7.18M | 5.01M | 1.41M |
| Total Debt | 87.52M | 95.81M | 107.35M | 26.49M | 21.11M | 18.20M |
| Total Liabilities | 102.15M | 112.40M | 125.23M | 51.95M | 41.00M | 37.63M |
| Stockholders Equity | 34.67M | 44.14M | 50.29M | 41.86M | 42.30M | 40.44M |
Cash Flow | ||||||
| Free Cash Flow | -1.14M | 2.19M | 4.53M | 7.20M | 4.51M | -3.55M |
| Operating Cash Flow | 1.85M | 4.65M | 8.39M | 10.62M | 9.57M | 10.35M |
| Investing Cash Flow | 3.47M | -2.39M | 1.28M | -3.20M | -5.05M | -14.64M |
| Financing Cash Flow | -4.46M | -5.40M | -19.69M | -5.25M | -919.00K | -1.54M |
Ark Restaurants Technical Analysis
Neutral
7.13
Price Trends
7.11
Positive
8.08
Negative
9.63
Negative
Market Momentum
-0.02
Negative
49.32
Neutral
55.42
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARKR, the sentiment is Neutral. The current price of 7.13 is below the 20-day moving average (MA) of 7.15, above the 50-day MA of 7.11, and below the 200-day MA of 9.63, indicating a neutral trend. The MACD of -0.02 indicates Negative momentum. The RSI at 49.32 is Neutral, neither overbought nor oversold. The STOCH value of 55.42 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ARKR.
Ark Restaurants Risk Analysis
Ark Restaurants disclosed 32 risk factors in its most recent earnings report. Ark Restaurants reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Ark Restaurants Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | $59.20M | 13.70 | 6.88% | 1.71% | 8.83% | 41.90% | |
62 Neutral | $39.65M | 14.99 | 20.12% | ― | -1.30% | 9.43% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
51 Neutral | $15.09M | 12.21 | 3.85% | ― | 1.84% | 12.10% | |
48 Neutral | $36.14M | ― | ― | 154.87% | 0.96% | -57.29% | |
43 Neutral | $25.96M | ― | -33.50% | ― | -6.89% | -42.75% | |
41 Neutral | $31.01M | ― | ― | ― | -1.23% | -68.38% |
* Consumer Cyclical Sector Average
ARKR
Ark Restaurants
7.13
-4.76
-40.03%
BDL
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32.14
6.52
25.45%
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1.52
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RAVE
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2.72
-0.14
-4.90%
NDLS
Noodles & Co
0.72
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-41.94%
FAT
Fat Brands
1.95
-0.87
-30.85%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.