Arq Inc (ARQ) AI Stock Analysis

• Market Cap: $313.78M
• Dividend Yield: N/A
• Average Volume (3M): 281.62K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.80
• Revenue Growth: 11.96%
• EPS Growth: 70.59%
• Country: US
• Employees: 200
• Sector: Industrials
• Sector Strength: 79
• Industry: Industrial - Pollution & Treatment Controls
• EPS (TTM): -0.05
• Shares Outstanding: 42,691,242
• 10 Day Avg. Volume: 316,420
• 30 Day Avg. Volume: 281,615
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.81
• Enterprise Value/Revenue: 2.16
• Enterprise Value/Gross Profit: 5.96
• Enterprise Value/Ebitda: 23.71
• 1Y Price Target: $9.60
• Price Target Upside: 25.65% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 57 Neutral
• Price Target: $7.50 ▼(-1.83% Downside)

Arq Inc's overall stock score is primarily influenced by its strong earnings call performance and positive technical analysis. However, financial performance challenges and poor valuation metrics weigh down the score. The company's strategic initiatives and market momentum provide optimism, but profitability and cash flow issues need addressing.

Positive Factors

Pricing Strategy

Converting from powdered activated carbon to granular activated carbon should increase prices and margins for Arq — driving meaningful higher revenue and profits.

Production Achievement

Arq announced that it has successfully completed commissioning of its first Granular Activated Carbon production line at the Company's Red River Plant, and initial production was successfully achieved.

Regulatory Environment

The Trump EPA appears at least to be supportive of maintaining PFAS remediation rules.

Negative Factors

Financial Performance

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

Transition Delays

The GAC metamorphosis is taking longer than expected.

Arq Inc Business Overview & Revenue Model

Company Description

Arq Inc (ARQ) is a technology company focused on developing innovative solutions in the fields of data analytics and artificial intelligence. The company operates primarily in the software sector, providing advanced tools and platforms that enable businesses to harness the power of big data for decision-making processes. Core products include data management software, analytics platforms, and AI-driven insights that cater to various industries such as healthcare, finance, and retail.

How the Company Makes Money

Arq Inc generates revenue through a subscription-based model for its software platforms, charging clients monthly or annually for access to its data analytics and AI solutions. Additionally, the company offers tiered licensing options for enterprise clients, providing customized solutions and support at higher price points. Key revenue streams also include professional services such as consulting, training, and implementation support for clients looking to integrate Arq's technologies into their existing systems. Strategic partnerships with major cloud service providers and industry leaders further enhance Arq's market reach and contribute to its earnings through collaborative projects and joint marketing efforts.

Arq Inc Financial Statement Overview

Summary

Arq Inc faces profitability and cash flow challenges despite maintaining a strong balance sheet with low leverage. The income statement shows mixed results with a stable gross profit margin but negative net profit margin. Cash flow analysis indicates significant challenges with negative free cash flow growth.

Income Statement

Arq Inc's income statement shows mixed results. The TTM (Trailing-Twelve-Months) gross profit margin is stable at 36.27%, indicating efficient cost management. However, the net profit margin is negative at -1.40%, reflecting ongoing profitability challenges. Revenue growth is modest at 2.78%, suggesting limited expansion. The EBIT and EBITDA margins are low at 2.03% and 9.11%, respectively, indicating pressure on operational efficiency.

Balance Sheet

The balance sheet of Arq Inc reveals a strong equity position with a low debt-to-equity ratio of 0.05, indicating low financial leverage and reduced risk. However, the return on equity is negative at -0.76%, highlighting challenges in generating returns for shareholders. The equity ratio is healthy, suggesting a stable financial structure.

Cash Flow

Cash flow analysis indicates significant challenges. The free cash flow growth rate is negative at -57.63%, and the free cash flow to net income ratio is highly negative, reflecting cash flow difficulties. The operating cash flow to net income ratio is low at 0.02, indicating insufficient cash generation relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	117.64M	108.96M	99.18M	102.99M	100.29M	67.36M
Gross Profit	42.67M	39.44M	31.86M	16.11M	26.79M	8.43M
EBITDA	10.73M	6.58M	1.46M	-1.96M	85.50M	-1.33M
Net Income	-1.65M	-5.11M	-12.25M	-8.92M	60.40M	-20.30M
Balance Sheet
Total Assets	284.54M	284.37M	235.50M	192.17M	197.41M	156.12M
Cash, Cash Equivalents and Short-Term Investments	6.96M	13.52M	45.36M	66.43M	78.75M	30.93M
Total Debt	38.45M	34.36M	31.74M	12.44M	10.50M	26.88M
Total Liabilities	67.77M	67.09M	57.10M	52.19M	50.11M	70.91M
Stockholders Equity	216.77M	217.28M	178.40M	139.98M	147.30M	85.21M
Cash Flow
Free Cash Flow	-17.85M	-74.69M	-44.17M	-11.92M	69.48M	46.58M
Operating Cash Flow	695.00K	10.48M	-16.65M	-2.42M	77.08M	54.05M
Investing Cash Flow	-61.75M	-85.07M	-28.54M	-8.24M	-6.70M	-7.47M
Financing Cash Flow	32.35M	42.68M	22.91M	-1.68M	-17.53M	-27.73M

Arq Inc Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.64
• 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 ARQ, the sentiment is Positive. The current price of 7.64 is above the 20-day moving average (MA) of 6.87, above the 50-day MA of 6.10, and above the 200-day MA of 5.68, indicating a bullish trend. The MACD of 0.45 indicates Negative momentum. The RSI at 67.59 is Neutral, neither overbought nor oversold. The STOCH value of 78.62 is Neutral, 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	76 Outperform	$1.70B	33.59	19.67%	―	15.74%	294.80%
Sector *	64 Neutral	$10.96B	16.35	8.89%	1.96%	2.68%	-15.17%
ARQ	57 Neutral	$313.78M	―	-0.81%	―	11.96%	70.59%
CLIR	56 Neutral	$30.41M	―	-46.19%	―	19.03%	11.70%
FTEK	53 Neutral	$97.57M	―	-7.69%	―	-4.78%	-1359.72%
LIQT	43 Neutral	$18.70M	―	-78.97%	―	-12.76%	15.23%
SCWO	39 Underperform	$40.81M	―	-160.82%	―	―	―

Arq Inc Corporate Events

Arq Inc Launches GAC Production Line at Red River

On August 6, 2025, Arq Inc. announced the successful commissioning of its first granular activated carbon (GAC) production line at the Red River Plant, marking a significant milestone in its corporate transformation. The company has commenced commercial-scale production, with initial sales completed, and plans to ramp up to a target of 25 million pounds annualized production. This development positions Arq to meet the strong demand in the GAC market, enhancing its strategic value and growth opportunities.

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.