Archrock (AROC) AI Stock Analysis

• Market Cap: $4.44B
• Dividend Yield: 3.16%
• Average Volume (3M): 1.68M
• Price to Earnings (P/E): 16.9
• Beta (1Y): 1.20
• 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): 0.40
• Shares Outstanding: 175,369,640
• 10 Day Avg. Volume: 2,196,380
• 30 Day Avg. Volume: 1,676,164
• PEG Ratio: 0.41
• Price to Book (P/B): 3.05
• Price to Sales (P/S): 3.48
• P/FCF Ratio: 57.16
• Enterprise Value/Market Cap: 1.61
• Enterprise Value/Revenue: 4.98
• Enterprise Value/Gross Profit: 7.78
• Enterprise Value/Ebitda: 9.43
• 1Y Price Target: $32.00
• Price Target Upside: 26.28% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4
• EPS Forecast (FY): 1.58
• Revenue Forecast (FY): $1.49B

• Rating: 79 Outperform
• Price Target: $29.00 ▲(14.44% Upside)

Archrock's strong financial performance and positive earnings call are the most significant factors driving the score. The company shows robust revenue growth, profitability, and cash flow generation, supported by a strong operational outlook. Technical analysis indicates a positive trend, although nearing overbought conditions. Valuation is reasonable, with an attractive dividend yield. Challenges include commodity price volatility and extended equipment lead times.

Positive Factors

Revenue Growth

Consistent revenue growth reflects strong market demand and effective business strategies, enhancing long-term financial stability.

Cash Flow Generation

Strong cash flow generation enhances financial flexibility, supporting operational needs and potential strategic investments.

High Fleet Utilization

High fleet utilization indicates efficient asset use and strong demand for services, supporting sustained revenue and profitability.

Negative Factors

Commodity Price Volatility

Volatile commodity prices can impact revenue stability and profitability, posing risks to long-term financial performance.

Extended Equipment Lead Times

Extended lead times can hinder the company's ability to meet market demands promptly, affecting growth and customer satisfaction.

High Leverage

High leverage can limit financial flexibility and increase risk, potentially impacting the company's ability to invest in growth opportunities.

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

Archrock demonstrates solid financial health with strong revenue growth, profitability, and cash flow generation. The company effectively manages its operations, as evidenced by healthy margins and a robust ROE. While leverage remains a consideration, the consistent equity base and improved cash flow position mitigate associated risks.

Income Statement

Archrock's income statement shows strong performance with a consistent upward trajectory in revenue and profitability. The TTM data reveals a gross profit margin of 34.02% and a net profit margin of 18.43%, indicating efficient cost management and profitability. Revenue growth has been robust, with a 6.69% increase in the latest period, reflecting strong market demand. The EBIT and EBITDA margins are also healthy at 35.76% and 52.92%, respectively, showcasing operational efficiency. However, the slight decline in gross profit margin compared to the previous year suggests potential cost pressures.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 1.81, which is relatively high but manageable within the industry context. The return on equity (ROE) is strong at 19.28%, indicating effective use of equity capital to generate profits. The equity ratio stands at 32.26%, suggesting a balanced approach to financing with a reasonable level of equity supporting the asset base. While leverage is on the higher side, the company has maintained a consistent equity base, mitigating some risk.

Cash Flow

Archrock's cash flow statement highlights significant improvement in free cash flow, with an impressive growth rate of 822.81% in the TTM period. The operating cash flow to net income ratio is 2.59, indicating strong cash generation relative to net income. The free cash flow to net income ratio of 29.02% suggests that a substantial portion of earnings is being converted into free cash flow, enhancing financial flexibility. Despite past volatility, the recent trends in cash flow are positive and support the company's operational needs.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	1.44B	1.16B	990.34M	845.57M	781.46M	874.97M
Gross Profit	921.13M	699.09M	541.32M	426.08M	422.54M	497.78M
EBITDA	760.48M	559.97M	424.68M	308.90M	315.38M	392.68M
Net Income	265.28M	172.23M	105.00M	44.30M	28.22M	-68.44M
Balance Sheet
Total Assets	4.41B	3.82B	2.66B	2.60B	2.59B	2.78B
Cash, Cash Equivalents and Short-Term Investments	4.08M	4.42M	1.34M	1.57M	1.57M	1.10M
Total Debt	2.57B	2.21B	1.60B	1.56B	1.55B	1.71B
Total Liabilities	2.99B	2.50B	1.78B	1.74B	1.70B	1.84B
Stockholders Equity	1.42B	1.32B	871.02M	860.69M	891.44M	935.56M
Cash Flow
Free Cash Flow	19.31M	70.56M	11.55M	-36.42M	139.51M	194.98M
Operating Cash Flow	531.97M	429.59M	310.19M	203.45M	237.40M	335.28M
Investing Cash Flow	-647.78M	-1.16B	-232.49M	-130.92M	16.11M	-85.03M
Financing Cash Flow	116.14M	733.55M	-77.92M	-72.54M	-253.03M	-252.84M

Archrock Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 25.34
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

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 25.34 is above the 20-day moving average (MA) of 24.92, above the 50-day MA of 24.63, and above the 200-day MA of 24.22, indicating a bullish trend. The MACD of 0.33 indicates Negative momentum. The RSI at 54.24 is Neutral, neither overbought nor oversold. The STOCH value of 42.00 is Neutral, 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	79 Outperform	$4.44B	16.86	19.33%	3.16%	31.94%	64.74%
NGS	78 Outperform	$408.24M	21.95	7.15%	0.65%	9.53%	15.48%
VAL	76 Outperform	$3.44B	8.83	17.49%	―	6.81%	-61.94%
NOV	72 Outperform	$5.72B	15.65	5.93%	3.25%	-1.43%	-63.13%
USAC	70 Outperform	$2.78B	28.26	―	9.27%	6.66%	43.66%
KGS	68 Neutral	$3.11B	45.96	5.86%	4.96%	19.43%	164.71%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%

Archrock Corporate Events

Archrock Shifts to Online Platform for Updates

On November 12, 2025, Archrock, Inc. released an investor presentation on its website, indicating a shift towards using its online platform for future updates, potentially impacting how investors access company information.

Archrock Plans Redemption of Senior Notes

On October 9, 2025, Archrock Inc. announced that its subsidiary, Archrock Partners, L.P., plans to redeem all $300 million of its outstanding 6.875% senior notes due in 2027. The redemption is scheduled for November 17, 2025, and will be executed at the principal amount plus accrued interest. This move may impact Archrock’s financial structure and stakeholder interests.