Arq Inc (ARQ) AI Stock Analysis

• Market Cap: $81.41M
• Dividend Yield: N/A
• Average Volume (3M): 1.09M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.24
• Revenue Growth: 7.20%
• EPS Growth: -2951.61%
• Country: US
• Employees: 200
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Pollution & Treatment Controls
• EPS (TTM): -1.20
• Shares Outstanding: 42,849,250
• 10 Day Avg. Volume: 2,727,892
• 30 Day Avg. Volume: 1,087,532
• PEG Ratio: >-0.01
• Price to Book (P/B): 0.81
• Price to Sales (P/S): 1.13
• P/FCF Ratio: -12.28
• Enterprise Value/Market Cap: 1.38
• Enterprise Value/Revenue: 0.94
• Enterprise Value/Gross Profit: 5.17
• Enterprise Value/Ebitda: 30.92
• 1Y Price Target: $5.75
• Price Target Upside: 202.63% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): -0.17
• Revenue Forecast (FY): $137.21M

• Rating: 44 Neutral
• Price Target: $2.00 ▲(5.26% Upside)
• Action: Reiterated Date: 03/13/26
• Date: Action: Reiterated 03/13/26

The score is held down mainly by weak profitability and negative cash flow, reinforced by a bearish technical trend. Offsetting factors include a low-debt balance sheet, improving EBITDA and PAC execution from the earnings call, and a modest near-term liquidity relief from the credit agreement amendment.

Positive Factors

Conservative leverage / balance-sheet flexibility

Low debt relative to equity gives Arq durable financial flexibility to fund GAC ramp and capex without immediate insolvency risk. This conservative capital structure reduces refinancing pressure, supports covenant negotiation, and preserves capacity to absorb operational hiccups over the next 2–6 months.

Improving adjusted EBITDA and PAC strength

Material improvement in trailing adjusted EBITDA and strong PAC margins reflect operational progress and cost discipline that can drive sustainable profitability. Higher PAC selling prices and sharp SG&A cuts create a steadier cash-earnings base that can offset GAC startup volatility over multiple quarters.

Feedstock diversification / alternative revenue optionality

Active exploration of alternative feedstock end markets provides structural optionality to diversify revenue and margin sources beyond GAC/PAC. Successful commercialization could reduce concentration risk, monetize byproducts, and improve long-term resilience to single-market or feedstock variability.

Negative Factors

Negative operating and free cash flow

Persistent negative operating and free cash flow undermines the company's ability to self-fund growth and absorb GAC ramp costs. Over a multi-quarter horizon this increases reliance on credit or equity, elevates dilution or covenant risk, and constrains discretionary investment in capacity or diversification.

GAC ramp delays, design issues and inefficiency costs

Prolonged GAC startup issues create sustained under-utilization and high fixed-cost absorption, directly pressuring margins and cash generation. Delays to mid-2026 push out revenue recognition from expected capacity, increasing the risk that expected returns and payback timelines will lengthen materially.

Weak profitability / net losses despite revenue gains

Although revenue has accelerated and gross margin sits in the mid-30s, operating losses and negative net income indicate earnings are not yet sustainable. Continued operating deficits limit reinvestment, can erode equity returns, and may necessitate external funding or cost restructuring to reach consistent profitability.

Arq Inc Business Overview & Revenue Model

Company Description

Arq, Inc. produces activated carbon products in North America. The company's products include granular activated carbon, powdered activated carbon, and colloidal carbon products; Arq Powder Wetcake, a fine and low-ash coal waste-derived particle; and additives for air emissions control. Its products are used in various applications, including; water treatment, ground water remediation, soil sediments, air emissions, and asphalt additives. The company was formerly known as Advanced Emissions Solutions, Inc. and changed its name to Arq, Inc. in February 2024. The company was founded in 1996 and is headquartered in Greenwood Village, Colorado.

How the Company Makes Money

Arq makes money primarily by manufacturing and selling activated carbon products to industrial and environmental customers. Revenue is generated through product sales (typically priced per unit/ton and fulfilled via customer purchase orders or supply arrangements) where Arq supplies activated carbon for applications such as emissions control and purification/filtration. The company’s earnings are therefore driven by sales volumes, realized pricing, customer demand across its served end markets, and its ability to produce and deliver product efficiently. Significant partnerships or specific customer concentration details: null.

Arq Inc Financial Statement Overview

Summary

Revenue growth has accelerated and leverage is low, but the latest period shows a large net loss, deeply negative operating profit, and negative operating/free cash flow. The balance sheet provides flexibility, yet weak profitability and cash conversion are the primary financial risks.

Income Statement

Revenue growth has improved, with TTM (Trailing-Twelve-Months) revenue up sharply versus the prior year, following modest growth in 2024 after a decline in 2023. Gross margin is solid in TTM (mid-30% range), but profitability is weak: TTM shows a large net loss and deeply negative operating profit, indicating a meaningful deterioration versus 2024 (which was closer to break-even at the operating line). Overall, top-line momentum is a strength, but the swing to heavier losses is a key concern.

Balance Sheet

Leverage appears conservative: debt is low relative to equity (debt-to-equity ~0.16 in both TTM and 2024), giving the company balance-sheet flexibility. Equity remains sizable versus assets, supporting solvency. The main weakness is returns: return on equity is negative across recent periods (including TTM), reflecting ongoing losses despite the relatively strong capital base.

Cash Flow

Cash generation is pressured. TTM (Trailing-Twelve-Months) operating cash flow is negative and free cash flow is also negative, with a steep decline in free cash flow versus the prior period. While 2024 produced positive operating cash flow, free cash flow was still heavily negative, suggesting significant cash outflows beyond core operations. Overall, cash flow volatility and persistent negative free cash flow weigh on financial quality.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	120.34M	108.96M	99.18M	102.99M	100.29M
Gross Profit	21.79M	39.44M	31.86M	22.52M	34.72M
EBITDA	3.64M	6.58M	1.46M	-1.96M	85.50M
Net Income	-52.61M	-5.11M	-12.25M	-8.92M	60.40M
Balance Sheet
Total Assets	230.58M	284.37M	235.50M	181.16M	185.44M
Cash, Cash Equivalents and Short-Term Investments	6.57M	13.52M	45.36M	66.43M	78.75M
Total Debt	37.39M	34.36M	31.74M	12.44M	10.50M
Total Liabilities	62.62M	67.09M	57.10M	41.19M	38.13M
Stockholders Equity	167.96M	217.28M	178.40M	139.98M	147.30M
Cash Flow
Free Cash Flow	-11.05M	-74.69M	-44.17M	-14.97M	19.80M
Operating Cash Flow	-2.48M	10.48M	-16.65M	-6.06M	26.00M
Investing Cash Flow	-8.41M	-85.07M	-28.54M	-4.61M	44.38M
Financing Cash Flow	3.70M	42.68M	22.91M	-1.68M	-17.53M

Arq Inc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 1.90
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARQ, the sentiment is Negative. The current price of 1.9 is below the 20-day moving average (MA) of 2.89, below the 50-day MA of 3.35, and below the 200-day MA of 5.06, indicating a bearish trend. The MACD of -0.46 indicates Positive momentum. The RSI at 26.11 is Positive, neither overbought nor oversold. The STOCH value of 18.04 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ARQ.

Arq Inc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CECO	67 Neutral	$1.85B	42.25	16.53%	―	29.86%	331.33%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
FTEK	56 Neutral	$38.39M	-20.77	-5.70%	―	-5.66%	-397.46%
LIQT	53 Neutral	$15.42M	-1.35	-73.79%	―	10.97%	44.99%
CLIR	48 Neutral	$20.18M	-7.52	-56.07%	―	-49.70%	-2.72%
SCWO	48 Neutral	$46.20M	-2.39	-160.16%	―	―	―
ARQ	44 Neutral	$81.41M	―	-25.66%	―	7.20%	-2951.61%

Arq Inc Corporate Events

Arq amends revolving credit agreement, easing liquidity requirements

On February 27, 2026, Arq Inc. and certain subsidiaries executed a fourth amendment to their Revolving Credit Agreement with MidCap Funding IV Trust and participating lenders, modifying key terms governing borrowing availability and liquidity thresholds. The amendment extends prior changes to the borrowing base calculation and lowers the company’s minimum liquidity requirement to $2 million from December 10, 2025, through March 31, 2026, before it steps up to $5 million from April 1, 2026, which temporarily eases near‑term liquidity pressure and may provide added flexibility in managing cash and credit utilization.

The most recent analyst rating on (ARQ) stock is a Buy with a $7.50 price target. To see the full list of analyst forecasts on Arq Inc stock, see the ARQ Stock Forecast page.

Arq Inc amends revolving credit agreement, easing liquidity covenants

On January 28, 2026, Arq, Inc. and certain subsidiaries entered into a third amendment to their existing revolving credit agreement with MidCap Funding IV Trust and participating lenders. The amendment extends prior changes to the calculation of borrowing availability and prolongs a temporary reduction in the company’s minimum liquidity covenant, requiring at least $2.0 million in liquidity from December 10, 2025 through February 27, 2026, rising to $5.0 million from February 28, 2026 onward, which affects the company’s short-term financial flexibility and covenant compliance obligations.

The most recent analyst rating on (ARQ) stock is a Buy with a $7.50 price target. To see the full list of analyst forecasts on Arq Inc stock, see the ARQ Stock Forecast page.