Archrock (AROC) AI Stock Analysis

• Market Cap: $6.18B
• Dividend Yield: 3.08%
• Average Volume (3M): 1.49M
• Price to Earnings (P/E): 19.2
• Beta (1Y): 1.14
• Revenue Growth: 31.94%
• EPS Growth: 64.74%
• Country: US
• Employees: 1,300
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Equipment & Services
• EPS (TTM): 0.67
• Shares Outstanding: 175,369,640
• 10 Day Avg. Volume: 1,372,008
• 30 Day Avg. Volume: 1,493,302
• PEG Ratio: 0.18
• Price to Book (P/B): 3.04
• Price to Sales (P/S): 3.05
• P/FCF Ratio: 37.94
• Enterprise Value/Market Cap: 1.39
• Enterprise Value/Revenue: 5.78
• Enterprise Value/Gross Profit: 9.45
• Enterprise Value/Ebitda: 10.09
• 1Y Price Target: $37.20
• Price Target Upside: 5.29% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): 1.89
• Revenue Forecast (FY): $1.57B

• Rating: 76 Outperform
• Price Target: $40.00 ▲(13.22% Upside)
• Action: Reiterated Date: 02/27/26
• Date: Action: Reiterated 02/27/26

The score is driven primarily by strong financial execution and cash generation, reinforced by a positive earnings call with solid 2026 guidance, backlog visibility, and improving leverage. The main offsets are near-term technical overbought conditions and only moderate valuation support.

Positive Factors

Operating Cash Generation

Archrock's consistent and growing operating cash flow demonstrates durable cash conversion across cycles, funding growth CapEx, dividends and buybacks without relying on equity. Strong OCF provides resilience through commodity cycles and supports capital allocation and deleveraging plans over the next 2–6 months.

Contract Margins & Utilization

Very high margins and sustained ≥95% utilization reflect structural pricing power and differentiated fleet economics in compression services. Persistent high utilization and fleet efficiency underpin durable profitability and make revenue streams less cyclical, supporting long-term margin sustainability.

Backlog and Growth CapEx Visibility

A high contracted backlog and booked units for 2027 provide multi-period revenue visibility and de‑risk near-term demand. Targeted growth CapEx tied to quantifiable horsepower additions supports organic expansion and predictable capacity buildout, enabling sustainable revenue growth over the medium term.

Negative Factors

Elevated Leverage

High leverage in a cyclical services business increases financial risk if demand or cash flow softens. While improving, the debt load constrains flexibility for opportunistic investments and raises refinancing and interest exposure risk over the next few quarters, especially if capex or asset-sale timing shifts.

Extended Equipment Lead Times

Multi-year supplier lead times create execution risk for fleet expansion and can drive build-cost inflation. Delays hamper the realization of growth CapEx into revenue, lengthen payback periods on new horsepower, and increase exposure to input price swings and scheduling mismatches with customer needs.

Rising Maintenance CapEx

Higher recurring maintenance and overhaul spending raises structural capital intensity and can pressure free cash flow in the medium term. Elevated maintenance capex reduces discretionary cash for buybacks or deleveraging and reflects aging fleet demands that may persist until newer builds fully come online.

Archrock Business Overview & Revenue Model

Company Description

Archrock, Inc., together with its subsidiaries, operates as an energy infrastructure company in the United States. It operates in two segments, Contract Operations and Aftermarket Services. The company engages in the designing, sourcing, owning, installing, operating, servicing, repairing, and maintaining its owned fleet of natural gas compression equipment to provide natural gas compression services to customers in the oil and natural gas industry. It also offers various aftermarket services, such as sale of parts and components; and provision of operation, maintenance, overhaul, and reconfiguration services to customers who own compression equipment. The company was formerly known as Exterran Holdings, Inc. and changed its name to Archrock, Inc. in November 2015. Archrock, Inc. was founded in 1990 and is headquartered in Houston, Texas.

How the Company Makes Money

Archrock generates revenue primarily through its Contract Compression Services, which involves leasing and maintaining natural gas compressors for customers in the oil and gas sector. This segment provides a steady stream of income through long-term contracts that ensure consistent cash flow. Additionally, the Parts & Service segment contributes to revenue by offering maintenance services, spare parts, and customer support, further enhancing the company's profitability. Strategic partnerships with major energy companies and a focus on operational efficiency also play significant roles in driving earnings, as they enable Archrock to secure long-term contracts and optimize service delivery.

Archrock Financial Statement Overview

Summary

Strong operating trajectory driven by consistent 2022–2024 revenue growth and materially improved profitability, plus robust operating cash flow generation and generally improving free cash flow. Offsets include elevated leverage in 2022–2024 and incomplete/zeroed 2025 line items in the provided statements, which reduces confidence in the latest-year margin and balance sheet trend.

Income Statement

Revenue has grown consistently from 2022–2024 (with ~17% growth in both 2023 and 2024), supporting improving scale. Profitability has strengthened materially versus 2020’s loss, with net margin improving to ~14.9% in 2024 and operating profitability also higher (EBIT margin ~31.7% in 2024). A key limitation is that 2025 annual margin detail is missing (gross profit/EBIT shown as 0), which reduces confidence in trend quality despite higher net income and revenue in 2025.

Balance Sheet

Leverage is the main constraint: debt-to-equity remained elevated in 2022–2024 (~1.67–1.83x), which increases financial risk in a cyclical services business. Equity has improved (from ~$871M in 2023 to ~$1.32B in 2024), and returns on equity were solidly positive in 2022–2024 (~5% to ~13%), reflecting improved profitability. However, 2025 annual balance sheet completeness is limited (debt and assets listed as 0), so the latest-year leverage picture cannot be verified from the provided data.

Cash Flow

Cash generation is a clear strength: operating cash flow increased from ~$203M (2022) to ~$310M (2023) to ~$430M (2024). Operating cash flow comfortably exceeded net income in 2023–2024 (coverage ~2.0–2.3x), indicating strong cash conversion. Free cash flow was volatile (negative in 2022, low in 2023, improved to ~$71M in 2024), and the 2025 annual free cash flow jumps sharply to ~$622M; while supportive, the magnitude and the very high stated growth rate suggest year-to-year volatility and/or non-recurring working-capital/capex timing effects.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.49B	1.16B	990.34M	845.57M	781.46M
Gross Profit	723.63M	699.09M	541.32M	426.08M	422.54M
EBITDA	850.41M	559.97M	424.68M	308.90M	315.38M
Net Income	322.29M	172.23M	105.00M	44.30M	28.22M
Balance Sheet
Total Assets	4.35B	3.82B	2.66B	2.60B	2.59B
Cash, Cash Equivalents and Short-Term Investments	1.55M	4.42M	1.34M	1.57M	1.57M
Total Debt	2.42B	2.21B	1.60B	1.56B	1.55B
Total Liabilities	2.86B	2.50B	1.78B	1.74B	1.70B
Stockholders Equity	1.49B	1.32B	871.02M	860.69M	891.44M
Cash Flow
Free Cash Flow	119.64M	70.56M	11.55M	-36.42M	139.51M
Operating Cash Flow	622.11M	429.59M	310.19M	203.45M	237.40M
Investing Cash Flow	-606.90M	-1.16B	-232.49M	-130.92M	16.11M
Financing Cash Flow	-18.07M	733.55M	-77.92M	-72.54M	-253.03M

Archrock Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 35.33
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AROC, the sentiment is Positive. The current price of 35.33 is above the 20-day moving average (MA) of 32.25, above the 50-day MA of 28.66, and above the 200-day MA of 25.26, indicating a bullish trend. The MACD of 1.83 indicates Negative momentum. The RSI at 85.30 is Negative, neither overbought nor oversold. The STOCH value of 89.29 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AROC.

Archrock Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AROC	76 Outperform	$6.18B	19.16	22.72%	3.08%	31.94%	64.74%
VAL	75 Outperform	$6.64B	6.85	36.35%	―	6.81%	-61.94%
NGS	74 Outperform	$480.89M	25.86	7.15%	0.63%	9.53%	15.48%
KGS	72 Outperform	$4.69B	61.31	6.27%	4.86%	19.43%	164.71%
USAC	69 Neutral	$3.96B	32.16	―	9.11%	6.66%	43.66%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%
NOV	62 Neutral	$7.30B	52.39	2.29%	3.24%	-1.43%	-63.13%

Archrock Corporate Events

Archrock Announces Full Redemption of 2028 Senior Notes

On February 26, 2026, Archrock Inc. announced that its wholly owned subsidiary Archrock Partners, L.P. plans to redeem all $800 million of its outstanding 6.25% senior notes due 2028. The move affects notes co-issued by Archrock Partners Finance Corp. and represents a significant balance sheet action for the group.

The notes are scheduled to be redeemed on April 1, 2026, at 100% of principal plus accrued and unpaid interest up to, but excluding, the redemption date. Computershare Trust Company, N.A. will send the formal redemption notice to all registered noteholders by March 2, 2026, setting in motion repayment to bond investors and reshaping Archrock’s capital structure.

The most recent analyst rating on (AROC) stock is a Buy with a $40.00 price target. To see the full list of analyst forecasts on Archrock stock, see the AROC Stock Forecast page.

Archrock Posts Strong Q4 2025 Results, Raises Dividend

Archrock reported strong fourth quarter and full-year 2025 results on February 24, 2026, with revenue rising to $377.1 million for the quarter and $1.49 billion for the year, alongside net income of $116.8 million for the quarter and $322.3 million for 2025. EPS nearly doubled year over year, adjusted EBITDA climbed to $900.9 million, and even excluding sizable tax and asset-sale benefits, adjusted EBITDA still exceeded prior guidance.

Operationally, Archrock expanded active horsepower by 8% in 2025, maintained about 95.5% fleet utilization, and executed asset sales of 325,000 horsepower to fund high-return new builds while completing a second accretive acquisition in 18 months. The company reduced its leverage ratio to 2.69x, boosted the quarterly dividend to $0.22 with 4.9x coverage, returned $211.8 million to shareholders, upsized its repurchase program, and refinanced debt with a $800 million senior notes offering to strengthen its balance sheet.

Looking ahead, Archrock issued 2026 guidance calling for net income of $306 million to $356 million and adjusted EBITDA of $865 million to $915 million, including the impact of recently divested compression assets. It plans $250 million to $275 million of growth capital spending in 2026 to support customer expansion while targeting substantial free cash flow and positioning to benefit from sustained U.S. natural gas production growth, LNG-driven demand and power needs from AI-related data centers.

The most recent analyst rating on (AROC) stock is a Buy with a $32.00 price target. To see the full list of analyst forecasts on Archrock stock, see the AROC Stock Forecast page.

Archrock Launches 2026 Executive Pay and Incentive Plan

On February 18, 2026, Archrock’s board compensation committee approved a new 2026 short-term incentive program that sets cash bonus targets for its named executive officers as a percentage of eligible earnings, ranging from 75% to 125%. Payouts can vary from 0% to 200% of target and will be determined by performance against adjusted EBITDA, sustainability metrics, and operating team results, alongside individual leadership and strategic execution contributions, giving the committee wide discretion to align pay with 2026 corporate performance.

The committee also approved base salary increases for 2026 for the same executives, effective April 2026, raising CEO D. Bradley Childers’ base pay from $950,000 to $990,000 and granting smaller but notable increases to the CFO, general counsel, and senior operations leaders. These changes underscore Archrock’s emphasis on retaining top management and tying compensation more closely to financial, operational and sustainability outcomes, which may reinforce management’s focus on execution in a competitive energy services market.

The most recent analyst rating on (AROC) stock is a Buy with a $32.00 price target. To see the full list of analyst forecasts on Archrock stock, see the AROC Stock Forecast page.

Archrock Completes $800 Million Senior Notes Private Placement

On January 21, 2026, Archrock Services, L.P. and its co-issuer Archrock Partners Finance Corp. completed a private placement of $800 million in 6.000% senior notes due 2034, fully and unconditionally guaranteed on a senior unsecured basis by Archrock, Inc. and certain subsidiaries. The notes, issued to qualified institutional buyers and non-U.S. investors, carry semi-annual interest payments beginning August 1, 2026, feature a tiered call schedule and change-of-control repurchase rights, and are governed by covenants that restrict additional indebtedness, liens, asset sales, affiliate transactions and certain equity-related actions, though many of these limitations fall away if the notes achieve investment-grade ratings. Archrock said it intends to use the proceeds to repay borrowings under its revolving credit facility, a move that is expected to improve its debt profile and financial flexibility while reinforcing its position in the U.S. natural gas compression market.

The most recent analyst rating on (AROC) stock is a Buy with a $29.00 price target. To see the full list of analyst forecasts on Archrock stock, see the AROC Stock Forecast page.

Archrock Prices Upsized 2034 Senior Notes Private Offering

On December 15, 2025, Archrock announced that its subsidiaries Archrock Services, L.P. and Archrock Partners Finance Corp. had priced an upsized $800 million private offering of 6.000% senior notes due 2034 at par, with the transaction documented in a purchase agreement signed on January 6, 2026 and expected to close on or about January 21, 2026, subject to customary conditions. The notes, to be sold to qualified institutional buyers under Rule 144A and to non-U.S. investors under Regulation S, are expected to generate roughly $789 million in net proceeds, which Archrock intends to use primarily to repay borrowings under its revolving credit facility, a move that should reduce reliance on bank debt, potentially lower funding risk, and modestly reshape the company’s capital structure while imposing a 90-day restriction on new debt offerings without underwriter consent.

The most recent analyst rating on (AROC) stock is a Buy with a $29.00 price target. To see the full list of analyst forecasts on Archrock stock, see the AROC Stock Forecast page.

Archrock Announces $500 Million Senior Notes Private Offering

On January 6, 2026, Archrock, Inc. announced that its wholly owned subsidiary Archrock Services, L.P., together with Archrock Partners Finance Corp. as co-issuer, plans to launch a private offering of $500 million in senior notes due 2034 to eligible institutional and non-U.S. investors. Archrock intends to use the net proceeds to repay a portion of the outstanding borrowings under its revolving credit facility, a move that would restructure part of its debt profile and potentially lower funding costs, thereby strengthening the company’s balance sheet and financial flexibility within the U.S. natural gas compression sector.

The most recent analyst rating on (AROC) stock is a Buy with a $30.00 price target. To see the full list of analyst forecasts on Archrock stock, see the AROC Stock Forecast page.