ARC Resources (ARX) AI Stock Analysis

• Market Cap: C$13.28B
• Dividend Yield: 2.95%
• Average Volume (3M): 2.56M
• Price to Earnings (P/E): 9.9
• Beta (1Y): 0.92
• Revenue Growth: 15.61%
• EPS Growth: 12.15%
• Country: CA
• Employees: 438
• Sector: Energy
• Sector Strength: 52
• Industry: Oil & Gas Exploration & Production
• EPS (TTM): 0.37
• Shares Outstanding: 571,370,600
• 10 Day Avg. Volume: 2,306,052
• 30 Day Avg. Volume: 2,559,096
• PEG Ratio: -0.50
• Price to Book (P/B): 1.95
• Price to Sales (P/S): 3.04
• P/FCF Ratio: 28.36
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$31.36
• Price Target Upside: 34.87% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 10
• EPS Forecast (FY): 2.25
• Revenue Forecast (FY): C$6.24B

• Rating: 74 Outperform
• Price Target: C$29.00 ▲(24.73% Upside)

The score is driven primarily by strong underlying financial profitability with manageable leverage, plus a constructive earnings-call outlook emphasizing higher 2026 production and full free-cash-flow returns to shareholders. Valuation is supportive (low P/E and ~3% yield), while technical signals are mixed with neutral momentum and the stock still below its 200-day average.

ARC Resources Business Overview & Revenue Model

Company Description

ARC Resources Ltd. explores, develops, and produces crude oil, natural gas, and natural gas liquids in Canada. The company holds interests in the Montney properties located in northeast British Columbia and northern Alberta; and Pembina Cardium properties in central Alberta. As of December 31, 2020, it had proved plus probable reserves of 929 millions of barrels of oil equivalent. ARC Resources Ltd. was founded in 1996 and is headquartered in Calgary, Canada.

How the Company Makes Money

ARC Resources generates revenue through the sale of crude oil, natural gas, and natural gas liquids (NGLs) produced from its extensive portfolio of assets. The company's revenue model is primarily based on the production and sale of these hydrocarbons to various markets, including domestic and international buyers. ARC Resources leverages its advanced technology and operational expertise to maximize recovery rates and optimize production efficiency. Key revenue streams include long-term sales contracts, spot market sales, and potential hedging strategies to mitigate price volatility. The company's earnings are significantly influenced by global commodity prices, production volumes, and operational costs. Additionally, strategic partnerships and joint ventures can enhance its access to markets and infrastructure, contributing to its financial performance.

ARC Resources Financial Statement Overview

Summary

ARC Resources demonstrates strong financial health with robust profitability, effective cost management, and a solid balance sheet. Revenue growth has slowed, which requires monitoring, but the company's prudent use of leverage and strong cash flow generation support its overall stability. Continued focus on managing capital expenditure and sustaining growth will be key to maintaining its financial strength.

Income Statement

ARC Resources shows strong profitability with a stable gross profit margin of 48.9% and a notable net profit margin of 22.9% for TTM. Revenue growth is moderate at 4.1% from the previous period. The EBIT margin is solid at 30.4%, and EBITDA margin is robust at 55.4%, indicating effective cost management. However, the revenue growth has slowed compared to previous years, which could be a concern if the trend continues.

Balance Sheet

The balance sheet is healthy with a low debt-to-equity ratio of 0.25, reflecting conservative leverage. Return on equity is substantial at 16.6%, indicating efficient use of equity capital. The equity ratio stands at 62.1%, showcasing financial stability and a strong asset base. These metrics suggest a well-capitalized company with prudent financial management.

Cash Flow

Cash flow analysis reveals a positive trajectory with operating cash flow to net income ratio at 2.03, indicating strong cash generation relative to earnings. Free cash flow growth is impressive at 73.9% TTM, and free cash flow to net income ratio is 0.71, reflecting solid cash flow health. Nevertheless, the high capital expenditure reflects ongoing investment, which could impact short-term liquidity.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.85B	5.10B	5.66B	8.64B	5.11B	1.13B
Gross Profit	3.01B	2.83B	3.33B	5.55B	3.25B	687.10M
EBITDA	3.28B	2.74B	3.39B	4.25B	1.98B	566.10M
Net Income	1.39B	1.12B	1.60B	2.30B	786.60M	-547.20M
Balance Sheet
Total Assets	15.18B	13.10B	12.38B	11.62B	11.38B	4.95B
Cash, Cash Equivalents and Short-Term Investments	3.00M	0.00	1.10M	57.10M	0.00	400.00K
Total Debt	3.85B	2.39B	2.21B	1.79B	2.57B	751.10M
Total Liabilities	6.98B	5.15B	4.96B	4.97B	5.45B	2.16B
Stockholders Equity	8.20B	7.95B	7.43B	6.65B	5.93B	2.79B
Cash Flow
Free Cash Flow	1.31B	546.90M	567.80M	2.41B	953.90M	320.90M
Operating Cash Flow	3.08B	2.35B	2.39B	3.83B	2.01B	655.70M
Investing Cash Flow	-3.48B	-1.91B	-1.69B	-1.41B	-808.10M	-364.30M
Financing Cash Flow	410.50M	-443.50M	-759.60M	-2.36B	-1.20B	-299.50M

ARC Resources Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 23.25
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ARX, the sentiment is Negative. The current price of 23.25 is below the 20-day moving average (MA) of 25.38, below the 50-day MA of 25.30, and below the 200-day MA of 26.50, indicating a bearish trend. The MACD of -0.36 indicates Positive momentum. The RSI at 32.16 is Neutral, neither overbought nor oversold. The STOCH value of 3.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:ARX.

ARC Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PEY	81 Outperform	C$4.44B	11.73	13.48%	5.77%	11.52%	24.76%
ARX	74 Outperform	C$13.28B	9.93	17.02%	2.95%	15.61%	12.15%
WCP	74 Outperform	C$13.27B	9.49	10.88%	6.33%	36.36%	-19.92%
NVA	74 Outperform	C$3.48B	11.07	13.57%	―	-6.14%	14.09%
TOU	73 Outperform	C$22.66B	16.95	8.69%	4.79%	8.97%	-21.15%
SCR	69 Neutral	C$5.73B	5.17	9.60%	2.99%	-11.41%	40.81%
Sector *	65 Neutral	$15.17B	7.61	4.09%	5.20%	3.87%	-62.32%

ARC Resources Corporate Events

ARC Resources Reports Robust Q3 2025 Results and Announces 2026 Budget

ARC Resources Ltd. reported a strong third quarter in 2025 with a 10% year-over-year increase in production and a significant rise in crude oil and condensate output. The company announced an 11% dividend increase, reflecting its commitment to shareholder returns. ARC’s 2026 capital budget is set between $1.8 and $1.9 billion, aiming for record production levels and substantial free funds flow, which will be returned to shareholders through dividends and share repurchases.

The most recent analyst rating on (TSE:ARX) stock is a Buy with a C$33.00 price target. To see the full list of analyst forecasts on ARC Resources stock, see the TSE:ARX Stock Forecast page.