Ark Restaurants (ARKR) AI Stock Analysis

• Market Cap: $25.32M
• Dividend Yield: 2.67%
• Average Volume (3M): 14.79K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.20
• Revenue Growth: -6.89%
• EPS Growth: -42.75%
• Country: US
• Employees: 1,246
• Sector: Consumer Cyclical
• Sector Strength: 79
• Industry: Restaurants
• EPS (TTM): -0.96
• Shares Outstanding: 3,606,157
• 10 Day Avg. Volume: 4,231
• 30 Day Avg. Volume: 14,786
• PEG Ratio: 0.31
• Price to Book (P/B): 0.95
• Price to Sales (P/S): 0.23
• P/FCF Ratio: 19.23
• Enterprise Value/Market Cap: 4.24
• Enterprise Value/Revenue: 0.63
• Enterprise Value/Gross Profit: 2.43
• Enterprise Value/Ebitda: -37.70
• 1Y Price Target: $7.00
• Price Target Upside: -0.28% Downside
• Rating Consensus: Hold
• Number of Analyst Covering: 0

• Rating: 41 Neutral
• Price Target: $7.00 ▼(-0.28% Downside)

Ark Restaurants faces significant financial challenges, with declining revenues, high leverage, and cash flow constraints being the most impactful factors. The technical analysis indicates 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, these are overshadowed by the broader financial difficulties.

Positive Factors

Strong Balance Sheet

A strong balance sheet with low debt and significant cash reserves enhances financial stability and provides flexibility for future investments.

Individual Restaurant Performance

Strong performance in key locations like Las Vegas and New York indicates robust demand and operational efficiency, supporting revenue stability.

Potential Casino License Opportunity

Securing a casino license could significantly boost revenue by expanding market presence and tapping into new customer bases.

Negative Factors

Declining Revenue Growth

Persistent revenue declines indicate challenges in maintaining market share and customer engagement, impacting long-term financial health.

High Leverage

High leverage increases financial risk and limits the company's ability to invest in growth opportunities, potentially affecting future profitability.

Significant Cash Flow Decline

Deteriorating cash flow limits operational flexibility and the ability to fund new projects or manage unexpected expenses, posing a risk to sustainability.

Ark Restaurants Business Overview & Revenue Model

Company Description

Ark 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 Money

Ark 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 Financial Statement Overview

Summary

Ark Restaurants is facing significant financial challenges marked by declining revenue, profitability issues, and high leverage. The company’s high debt levels combined with negative net income and EBIT margins indicate operational inefficiencies. While the company has managed to sustain positive operating cash flow, its current trajectory suggests the need for strategic initiatives to improve profitability and reduce financial risk.

Income Statement

Ark Restaurants has shown a decline in revenue with a negative revenue growth rate from 2024 to 2025. The gross profit margin for TTM is approximately 33.55%, but the company is currently operating with negative EBIT and net profit margins, indicating challenges in profitability and operational efficiency. Historically, the company had positive EBIT and net income, suggesting recent operational difficulties.

Balance Sheet

The debt-to-equity ratio is high at approximately 2.35 in TTM, indicating significant leverage which poses financial risk. The return on equity is negative due to the net loss, reflecting poor returns for shareholders. The equity ratio is relatively low at 26.88%, suggesting a reliance on debt financing. These metrics highlight financial risk due to high leverage and negative returns.

Cash Flow

The free cash flow has decreased significantly from previous periods, reflecting challenges in maintaining cash flow. The operating cash flow to net income ratio is negative due to net losses, but the company has managed to maintain positive operating cash flow. This indicates some resilience in cash generation despite profitability issues.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	171.83M	183.54M	184.79M	183.67M	131.87M	106.49M
Gross Profit	44.22M	68.18M	17.57M	71.10M	15.92M	2.73M
EBITDA	-2.85M	591.00K	634.00K	17.98M	22.10M	-2.94M
Net Income	-14.01M	-3.90M	-5.93M	9.28M	12.89M	-4.69M
Balance Sheet
Total Assets	136.34M	156.04M	176.96M	209.53M	161.22M	153.32M
Cash, Cash Equivalents and Short-Term Investments	-21.00K	10.27M	13.41M	28.46M	19.17M	16.89M
Total Debt	87.52M	95.81M	107.35M	128.64M	91.20M	101.15M
Total Liabilities	102.15M	112.40M	125.23M	149.42M	109.76M	116.16M
Stockholders Equity	34.67M	44.14M	50.29M	59.80M	50.41M	36.53M
Cash Flow
Free Cash Flow	-1.14M	2.19M	4.53M	17.65M	7.16M	-7.01M
Operating Cash Flow	1.85M	4.65M	8.39M	20.35M	9.29M	-4.53M
Investing Cash Flow	3.47M	-2.39M	1.28M	-7.76M	-3.45M	-2.46M
Financing Cash Flow	-4.46M	-5.40M	-19.69M	-8.32M	-3.56M	16.69M

Ark Restaurants Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 7.02
• 50DMA: Negative
• 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 ARKR, the sentiment is Negative. The current price of 7.02 is below the 20-day moving average (MA) of 7.08, below the 50-day MA of 7.83, and below the 200-day MA of 10.27, indicating a bearish trend. The MACD of -0.21 indicates Negative momentum. The RSI at 41.81 is Neutral, neither overbought nor oversold. The STOCH value of 60.73 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARKR.

Ark Restaurants Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RAVE	78 Outperform	$45.62M	17.21	21.75%	―	2.93%	20.81%
BDL	67 Neutral	$49.50M	11.83	6.88%	2.07%	8.83%	41.90%
Sector *	61 Neutral	$18.09B	12.97	-1.60%	2.98%	1.42%	-15.92%
GTIM	52 Neutral	$17.30M	14.01	3.85%	―	1.84%	12.10%
FAT	44 Neutral	$35.95M	―	38.50%	158.95%	0.96%	-57.29%
ARKR	41 Neutral	$25.32M	―	-33.50%	2.67%	-6.89%	-42.75%
NDLS	41 Neutral	$30.05M	―	-978.37%	―	-1.23%	-68.38%