Stock of the Day

May 6, 2020

Archrock (AROC)

$31.73
+$0.21 (+0.7%)
Market Cap: $5.56B

About Archrock

Archrock, Inc., together with its subsidiaries, operates as an energy infrastructure company in the United States. The company operates in two segments, Contract Operations and Aftermarket Services. It engages in the designing, sourcing, owning, installing, operating, servicing, repairing, and maintaining of its owned fleet of natural gas compression equipment to provide natural gas compression services. The company also sells over-the-counter parts and components; and provides operations, major and routine maintenance, overhaul, and reconfiguration services to customers who own compression equipment. It serves integrated and independent oil and natural gas processors, gatherers, and transporters. The company was formerly known as Exterran Holdings, Inc. and changed its name to Archrock, Inc. in November 2015. Archrock, Inc. was founded in 1990 and is headquartered in Houston, Texas.

Today's Trend

Archrock, Inc. (NYSE: AROC) shares have decreased as investors weigh weaker-than-expected second-quarter results and a series of downward earnings revisions against the company’s longer-term growth investments.

  • Archrock outlined a $1.4 billion-$1.6 billion growth capital-spending plan for 2027-2030, signaling continued investment in expanding its compression fleet and future earnings capacity. Archrock outlines growth capex plan
  • Management emphasized growth and capital discipline on its earnings call, which could support the company’s longer-term outlook if new investments generate the expected returns. Archrock earnings call highlights
  • Sidoti’s estimates imply 2027 EPS of $2.17, but the forecast remains below its prior $2.26 estimate. The revisions suggest analysts still expect growth, but at a slower pace.
  • Archrock reported second-quarter EPS of $0.38, below the $0.45 consensus estimate, while revenue of $371.2 million also missed expectations of $393.2 million and declined 3.1% year over year. The results prompted the stock to gap lower. Archrock shares gap down on disappointing earnings
  • Sidoti cut its 2026 EPS forecast to $1.71 from $1.89 and reduced estimates for every reported 2027 quarter, lowering FY2027 EPS to $2.17 from $2.26. The revisions are below the current full-year consensus of $1.90 and indicate increased concerns about near-term operating performance.
  • Management tightened its 2026 adjusted EBITDA outlook to $865 million-$885 million, adding to pressure on the shares despite the company’s longer-term capital-spending plans.
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