Archrock (AROC) and Its Competitors Critical Survey

Archrock (NYSE: AROC) is one of 48 publicly-traded companies in the “Oil Related Services and Equipment” industry, but how does it compare to its rivals? We will compare Archrock to similar companies based on the strength of its valuation, analyst recommendations, profitability, risk, institutional ownership, dividends and earnings.

Profitability

This table compares Archrock and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Archrock -8.62% -2.93% -0.83%
Archrock Competitors -11.53% -4.87% -3.16%

Risk & Volatility

Archrock has a beta of 3.5, suggesting that its share price is 250% more volatile than the S&P 500. Comparatively, Archrock’s rivals have a beta of 1.57, suggesting that their average share price is 57% more volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and recommmendations for Archrock and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Archrock 0 6 1 0 2.14
Archrock Competitors 417 2102 2944 117 2.49

Archrock presently has a consensus target price of $13.15, suggesting a potential upside of 38.42%. As a group, “Oil Related Services and Equipment” companies have a potential upside of 23.40%. Given Archrock’s higher probable upside, research analysts clearly believe Archrock is more favorable than its rivals.

Dividends

Archrock pays an annual dividend of $0.48 per share and has a dividend yield of 5.1%. Archrock pays out -49.0% of its earnings in the form of a dividend. As a group, “Oil Related Services and Equipment” companies pay a dividend yield of 2.9% and pay out -93.1% of their earnings in the form of a dividend.

Institutional and Insider Ownership

90.3% of Archrock shares are owned by institutional investors. Comparatively, 67.9% of shares of all “Oil Related Services and Equipment” companies are owned by institutional investors. 2.5% of Archrock shares are owned by insiders. Comparatively, 13.0% of shares of all “Oil Related Services and Equipment” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Earnings and Valuation

This table compares Archrock and its rivals top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Archrock $807.07 million -$54.55 million -9.69
Archrock Competitors $1.90 billion -$327.39 million -811.86

Archrock’s rivals have higher revenue, but lower earnings than Archrock. Archrock is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Summary

Archrock beats its rivals on 8 of the 14 factors compared.

About Archrock

Archrock, Inc. is a natural gas contract operations services company. The Company also provides natural gas compression services to customers in the oil and natural gas industry throughout the United States and supplies aftermarket services to customers that own compression equipment in the United States. The Company operates through two segments: contract operations and aftermarket services. The contract operations segment primarily provides natural gas compression services to meet specific customer requirements. The Company provides contract operations services, including the personnel, equipment, tools, materials and supplies to meet its customers’ natural gas compression needs. The aftermarket services segment provides a range of services to support the compression needs of customers, from parts sales and normal maintenance services to full operation of a customer’s owned assets.

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