Arq Inc (ARQ) AI Stock Analysis

• Market Cap: $271.09M
• Dividend Yield: N/A
• Average Volume (3M): 196.97K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.85
• Revenue Growth: 7.20%
• EPS Growth: -2951.61%
• Country: US
• Employees: 200
• Sector: Industrials
• Sector Strength: 72
• Industry: Industrial - Pollution & Treatment Controls
• EPS (TTM): -0.02
• Shares Outstanding: 42,691,242
• 10 Day Avg. Volume: 140,272
• 30 Day Avg. Volume: 196,969
• PEG Ratio: 0.80
• Price to Book (P/B): 1.26
• Price to Sales (P/S): 2.50
• P/FCF Ratio: -3.65
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 2.76
• Enterprise Value/Gross Profit: 8.28
• Enterprise Value/Ebitda: 34.13
• 1Y Price Target: $9.00
• Price Target Upside: 119.51% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 45 Neutral
• Price Target: $4.00 ▼(-2.44% Downside)

Arq Inc's overall stock score is driven by mixed financial performance and bearish technical indicators. While the earnings call highlights some positive developments, significant operational challenges and a weak valuation weigh heavily on the score.

Positive Factors

Strong PAC Business Performance

The PAC business's strong performance, with increased selling prices and reduced expenses, indicates robust demand and operational efficiency, supporting future revenue growth.

Strategic Revenue Diversification

Diversifying revenue streams through alternative uses for feedstock can enhance resilience and open new market opportunities, strengthening long-term growth prospects.

Low Financial Leverage

Low financial leverage reduces risk and enhances financial stability, providing flexibility for strategic investments and growth initiatives.

Negative Factors

GAC Production Delays

Delays in GAC production can hinder revenue growth and increase costs, impacting operational efficiency and profitability in the medium term.

Negative Cash Flow Growth

Negative cash flow growth indicates challenges in generating sufficient cash, potentially limiting the company's ability to fund operations and growth initiatives.

Net Profitability Challenges

Ongoing profitability challenges, as indicated by a negative net profit margin, can strain financial resources and hinder long-term value creation for shareholders.

Arq Inc Business Overview & Revenue Model

Company Description

Arq Inc (ARQ) is a technology company focused on providing innovative solutions in the field of renewable energy and sustainability. The company specializes in the development of advanced materials and processes for carbon capture, energy storage, and renewable energy systems. By leveraging cutting-edge technologies, Arq Inc aims to deliver sustainable products and services that contribute to a greener future, targeting sectors such as energy, manufacturing, and environmental services.

How the Company Makes Money

Arq Inc generates revenue through several key streams. Primarily, the company monetizes its technology by licensing its proprietary materials and processes to various industries, including energy and manufacturing sectors, which are seeking to enhance their sustainability practices. Additionally, Arq Inc may engage in joint ventures or partnerships with larger firms to co-develop projects, sharing both the risks and rewards associated with new technologies. Grants and funding from government and environmental organizations aimed at promoting renewable energy initiatives also contribute to the company's earnings. Furthermore, the sale of carbon credits generated through its carbon capture technologies represents another significant revenue stream as businesses seek to meet regulatory requirements and sustainability goals.

Arq Inc Financial Statement Overview

Summary

Arq Inc shows strong revenue growth but faces challenges in profitability and cash flow generation. The balance sheet is stable with low leverage, but operational efficiency and profitability need improvement.

Income Statement

Arq Inc shows a mixed performance in its income statement. The company has experienced a positive revenue growth rate of 25.5% in the TTM, indicating a strong top-line growth trajectory. However, profitability remains a concern with negative net profit margins and EBIT margins, reflecting operational challenges. The gross profit margin has improved slightly, but the company needs to address its cost structure to enhance profitability.

Balance Sheet

The balance sheet of Arq Inc is relatively stable with a low debt-to-equity ratio of 0.18, suggesting prudent financial leverage. However, the return on equity is negative, indicating that the company is not generating sufficient returns on shareholders' equity. The equity ratio is healthy, showing a strong capital base, but the company needs to improve its profitability to enhance shareholder value.

Cash Flow

Arq Inc's cash flow statement highlights significant challenges. The free cash flow is negative, although it has shown improvement in the TTM. The operating cash flow to net income ratio is low, indicating inefficiencies in converting earnings into cash. The company needs to focus on improving its cash generation capabilities to support its operations and growth.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	117.94M	108.96M	99.18M	102.99M	100.29M	67.36M
Gross Profit	39.35M	39.44M	31.86M	22.52M	34.72M	16.96M
EBITDA	9.55M	6.58M	1.46M	-1.96M	85.50M	-1.33M
Net Income	-3.92M	-5.11M	-12.25M	-8.92M	60.40M	-20.30M
Balance Sheet
Total Assets	277.95M	284.37M	235.50M	181.16M	185.44M	146.67M
Cash, Cash Equivalents and Short-Term Investments	7.03M	13.52M	45.36M	66.43M	78.75M	25.93M
Total Debt	34.96M	34.36M	31.74M	12.44M	10.50M	26.88M
Total Liabilities	60.79M	67.09M	57.10M	41.19M	38.13M	61.46M
Stockholders Equity	217.15M	217.28M	178.40M	139.98M	147.30M	85.21M
Cash Flow
Free Cash Flow	-40.85M	-74.69M	-44.17M	-14.97M	19.80M	47.36M
Operating Cash Flow	5.24M	10.48M	-16.65M	-6.06M	26.00M	54.05M
Investing Cash Flow	-50.82M	-85.07M	-28.54M	-4.61M	44.38M	-7.47M
Financing Cash Flow	3.70M	42.68M	22.91M	-1.68M	-17.53M	-27.73M

Arq Inc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 4.10
• 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 4.1 is below the 20-day moving average (MA) of 4.82, below the 50-day MA of 6.17, and below the 200-day MA of 5.50, indicating a bearish trend. The MACD of -0.91 indicates Positive momentum. The RSI at 21.59 is Positive, neither overbought nor oversold. The STOCH value of 14.05 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	72 Outperform	$1.79B	35.44	18.85%	―	29.86%	331.33%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
CLIR	52 Neutral	$45.34M	-7.69	-53.13%	―	-49.70%	-2.72%
ARQ	45 Neutral	$271.09M	―	-1.80%	―	7.20%	-2951.61%
FTEK	44 Neutral	$78.31M	-23.98	-7.10%	―	-5.66%	-397.46%
LIQT	41 Neutral	$18.39M	―	-73.79%	―	10.97%	44.99%
SCWO	39 Underperform	$65.53M	-3.44	-232.63%	―	―	―

Arq Inc Corporate Events

Arq, Inc. Earnings Call: Strategic Gains Amid Challenges

Arq, Inc. Reports Strong Performance Amidst Strategic Challenges

Arq, Inc. Reports Revenue Growth Amid Losses

Arq, Inc. is an environmental technology company specializing in consumable air, water, and soil treatment solutions, primarily based on activated carbon, with operations in the advanced purification technologies market. In its latest earnings report for the quarter ending June 30, 2025, Arq, Inc. reported a net loss of $2.1 million, an improvement from the $1.9 million loss in the same period last year. The company’s revenue increased to $28.6 million from $25.4 million in the previous year, driven by higher sales volumes in its primary markets. Despite the revenue growth, Arq, Inc. continues to face challenges with operating losses and interest expenses impacting its bottom line. The company’s management remains focused on improving operational efficiencies and expanding its market presence to drive future growth.