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Archrock, Inc. AROC

EnergyOil & Gas Equipment & ServicesNYSE📅 Scored March 7, 2026
Price at analysis: $36.21
Crucible Score
59.5
C+
Quality × Value Composite
KQI — Quality
67.7
B-
Fundamental Quality Index
KVI — Value
49.4
D+
Valuation Attractiveness Index
Crucible Verdict — AROC

Archrock, Inc. presents a classic quality-value disconnect, with solid operational fundamentals (KQI 67.7) trading at a meaningful discount (KVI 49.4). AROC's strongest asset is its durable competitive moat (81) in natural gas compression services, though diversification remains a glaring weakness (42). The 11% upside to fair value looks achievable given insider buying activity and consistent earnings execution.

— Kal, Kaladin Capital Intelligence

◆ KQI Quality Dimensions

Financial Quality
65.2
Growth Profile
73.4
Moat Durability⚠
81.0
Management Effectiveness⚠
61.4
Diversification & Resilience⚠
42.0
Market Position
56.0
Weakest dimension: Diversification & Resilience (42.0)

◆ KVI Value Dimensions

DCF Margin of Safety
62.4
FCF Yield & Cash Returns
20.9
Relative Valuation
27.4
Growth-Adjusted Value
86.5
Historical Valuation
55.0
Macro Context
38.5

◆ DCF Valuation Scenarios

Bear Case
$27.43
Base Case
$40.18
Bull Case
$57.62
Price at Analysis
$36.21
ScenarioFair ValueRev CAGR (5yr)Terminal MarginWACC
🔴 Bear$27.436.0%37.0%9.5%
🟢 Base$40.1810.0%40.0%8.9%
🟢 Bull$57.6214.0%44.0%8.4%
Key Assumptions: AROC has demonstrated strong revenue growth (~18% CAGR over trailing 5 years) and expanding margins driven by tight compression market fundamentals. Capex intensity averaged ~30% of revenue reflecting fleet growth investments; we assume this moderates slightly in later years. WACC is derived using CAPM with a 5.0-5.5% ERP range appropriate for midstream energy services, and tax rate reflects the recent 5-year average of ~25.5%. Net debt of ~$2,419M is subtracted from enterprise value to arrive at equity value.

◆ Financial Snapshot

Profitability

Gross Margin61.2%
Operating Margin38.0%
Net Margin21.6%
ROIC10.8%
ROE5.4%

Balance Sheet

Balance SheetCR: 1.54
Cash ConversionFCF/EPS: 0.37x
Capital IntensityCapex/Rev: 33.7%
Altman Z-Score1.45 (Distress)
Piotroski F-Score5/9 (Mixed)

Growth

Revenue CAGR17.5% CAGR
Earnings CAGR83.8% CAGR
Growth ConsistencyCV: 1.59
Segment Breadth5/6 growing (83%)
Quarterly TrendRev→+16%, Margin↑, WC↓
Earnings CredibilityTends to Beat

◆ Revenue Breakdown — FY2025

By Segment

Contract Operations Segment85.4%
Aftermarket Services Segment14.6%

By Geography

North America Contract Operations100.0%
Total Revenue
$610.9M
Fiscal Year 2017

◆ Analyst Consensus & Leadership

Analyst Price Targets

Avg Target (Last Quarter)$40.00
Analysts Covering (Quarter)1
Avg Target (Last Year)$36.00
Analysts (Year)2

Leadership & Governance

CEOTaryn Pryor · 3 years
CEO Ownership2.6%
Insider ActivityStrong Buying
Capital AllocationROIC 10.8% vs WACC 5.4%
Earnings Beat Rate70% (15/22)

◆ Company Profile

Archrock, Inc. , together with its subsidiaries, operates as an energy infrastructure company in the United States.

CEO
D. Bradley Childers
Employees
1300
Headquarters
Houston, TX, US
IPO Date
August 21, 2007
Exchange
NYSE

◆ Related Companies in Our Universe

Other Energy companies scored by the Crucible:

ADBE81.8A-NICE80.7A-DECK79.9A-INTU79.9A-EXEL78.3A-MTCH78.2A-TTD78.0B+
MethodologyAll ScoresCrucible BriefsPerformance@KaladinCI

Analysis conducted March 7, 2026 based on most recent SEC filings. Updated quarterly, after new SEC filings.

Point-in-time fundamental analysis. Not investment advice. Scores reflect company quality and valuation at time of analysis and may not reflect current market conditions.

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