Arq Inc (ARQ) AI Stock Analysis

• Market Cap: $254.11M
• Dividend Yield: N/A
• Average Volume (3M): 212.93K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.61
• Revenue Growth: 14.33%
• EPS Growth: 85.35%
• Country: US
• Employees: 200
• Sector: Industrials
• Sector Strength: 89
• Industry: Industrial - Pollution & Treatment Controls
• EPS (TTM): <0.01
• Shares Outstanding: 42,211,120
• 10 Day Avg. Volume: 238,486
• 30 Day Avg. Volume: 212,934
• PEG Ratio: 0.04
• Price to Book (P/B): 0.32
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -3.76
• Enterprise Value/Market Cap: -0.04
• Enterprise Value/Revenue: -0.02
• Enterprise Value/Gross Profit: -0.23
• Enterprise Value/Ebitda: -0.29
• 1Y Price Target: $7.50
• Price Target Upside: 25.63% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 56 Neutral
• Price Target: $6.00 ▲(0.50%Upside)

Arq Inc's overall stock score reflects a mixed financial performance with moderate revenue growth but challenges in profitability and cash flow. Technical indicators show positive momentum, while valuation is impacted by negative earnings. The earnings call provided a balanced outlook with strong growth prospects but highlighted operational challenges.

Positive Factors

Industry Outlook

Large water utilities and municipalities are moving at an accelerated pace to secure GAC supply, which is beneficial for Arq.

Market Opportunity

A material portion of Calgon Carbon's capacity is likely removed from the marketplace, leaving Arq with more opportunities.

Product Demand

Major water treatment facilities are proactively implementing PFAS removal technologies, indicating a continued demand for Arq's products.

Negative Factors

Financial Performance

Arq reported earnings that missed consensus estimates, with revenue and gross margin coming in below expectations.

Financial Transition

The delay is delaying the financial inflection point the GAC transition promises.

Project Delays

The GAC metamorphosis is taking longer than expected.

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 Inc makes money primarily through the sale of its proprietary Arq Fuel. The company partners with energy producers and distributors to integrate Arq Fuel into existing supply chains, enabling these partners to offer cleaner and more efficient energy solutions. Revenue is generated from direct sales of Arq Fuel as well as through strategic partnerships and licensing agreements that allow other companies to use Arq's technology in exchange for royalties. Additionally, Arq may benefit financially from government incentives aimed at promoting cleaner energy technologies.

Arq Inc Financial Statement Overview

Summary

Arq Inc shows moderate revenue growth but faces significant challenges in profitability and cash flow. The income statement indicates moderate growth, with a TTM revenue increase of 5%. However, the negative net profit margin and stressed cash flow dynamics highlight financial pressures. The balance sheet is strong, with low leverage and a high equity ratio, but the negative cash flow requires attention to improve financial health.

Income Statement

Arq Inc's income statement reflects moderate growth in revenue with a challenging profitability trajectory. The TTM (Trailing-Twelve-Months) revenue growth is notable at approximately 5% over the previous year, indicating positive sales momentum. However, profitability metrics such as the gross profit margin (34.66%) and net profit margin (-1.3%) suggest pressures on cost management and overall earnings. The EBIT margin (1.47%) and EBITDA margin (9.03%) show slight improvements but remain low, indicating ongoing operational challenges.

Balance Sheet

The balance sheet of Arq Inc indicates a solid equity position with a debt-to-equity ratio of 0.05, reflecting low leverage. This is favorable for financial stability and risk management. The return on equity (ROE) remains negative due to net losses, but the equity ratio stands strong at 76.92%, suggesting a robust capital structure with significant equity relative to total assets.

Cash Flow

Arq Inc faces significant challenges in cash flow management. Operating cash flow is negative, indicating cash outflows from operations. The free cash flow is also negative, driven by substantial capital expenditures. The free cash flow to net income ratio cannot be reliably assessed due to negative figures, highlighting stressed cash flow dynamics that could impact future growth and investment capacity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	114.47M	108.96M	99.18M	102.99M	100.29M	67.36M
Gross Profit	39.67M	39.44M	31.86M	16.11M	26.79M	8.43M
EBITDA	10.33M	6.58M	1.46M	-1.96M	85.50M	-1.33M
Net Income	-1.49M	-5.11M	-12.25M	-8.92M	60.40M	-20.30M
Balance Sheet
Total Assets	283.67M	284.37M	235.50M	192.17M	197.41M	156.12M
Cash, Cash Equivalents and Short-Term Investments	6.34M	13.52M	45.36M	66.43M	78.75M	30.93M
Total Debt	10.66M	34.36M	31.74M	12.44M	10.50M	26.88M
Total Liabilities	65.50M	67.09M	57.10M	52.19M	50.11M	70.91M
Stockholders Equity	218.17M	217.28M	178.40M	139.98M	147.30M	85.21M
Cash Flow
Free Cash Flow	-38.66M	-74.69M	-44.17M	-11.92M	69.48M	46.58M
Operating Cash Flow	-3.42M	10.48M	-16.65M	-2.42M	77.08M	54.05M
Investing Cash Flow	-79.03M	-85.07M	-28.54M	-8.24M	-6.70M	-7.47M
Financing Cash Flow	46.29M	43.31M	22.91M	-1.68M	-17.53M	-27.73M

Arq Inc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 5.97
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARQ, the sentiment is Positive. The current price of 5.97 is above the 20-day moving average (MA) of 5.34, above the 50-day MA of 4.79, and above the 200-day MA of 5.56, indicating a bullish trend. The MACD of 0.31 indicates Negative momentum. The RSI at 69.54 is Neutral, neither overbought nor oversold. The STOCH value of 92.15 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ARQ.

Arq Inc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CECO	80 Outperform	$1.04B	23.88	18.34%	―	8.89%	278.44%
FTEK	59 Neutral	$87.41M	―	-6.95%	―	7.30%	-247.48%
Sector *	59 Neutral	AU$1.63B	9.65	11.24%	3.67%	6.75%	3.18%
ARQ	56 Neutral	$254.11M	―	-0.76%	―	14.33%	85.35%
LIQT	52 Neutral	$15.57M	―	-69.66%	―	-17.77%	0.86%
CLIR	47 Neutral	$28.11M	―	-75.96%	―	10.88%	3.57%
SCWO	39 Underperform	$28.91M	―	-110.71%	―	―	―

Arq Inc Corporate Events

Arq Inc Announces Board Changes at Annual Meeting

On June 3, 2025, Arq Inc. held its annual meeting where significant changes to the Board of Directors were made, with L. Spencer Wells and Gilbert Li stepping down. The meeting included votes on various proposals, including the election of six directors, approval of executive compensation, and the ratification of Moss Adams LLP as the independent auditor for 2025. Richard Campbell-Breeden was appointed as Chair of the Board, with Laurie Bergman, Carol Eicher, and Campbell-Breeden taking key committee roles.

The most recent analyst rating on (ARQ) stock is a Buy with a $10.00 price target. To see the full list of analyst forecasts on Arq Inc stock, see the ARQ Stock Forecast page.

Arq Inc Delays Commissioning of GAC Facility

Arq, Inc. announced a revised timeline for the commissioning of its granular activated carbon (GAC) facility at the Red River Plant. Initially expected by the end of Q1 2025, the final commissioning and first commercial production are now anticipated by the end of Q2 or early Q3 2025 due to extended fine-tuning and testing. Despite producing small non-commercial volumes, the company aims to ensure consistent commercial-scale production without increasing capital expenditures. A ramp-up period of three to six months is expected to achieve full capacity.