Update shared on03 Oct 2025
Fair value Decreased 2.35%Analysts have lowered their price target for ARC Resources from C$35 to C$33. They cited modest shifts in revenue growth assumptions and an updated profit margin outlook as key factors for the revision.
Analyst Commentary
Recent analyst coverage for ARC Resources highlights both optimism surrounding the company’s fundamentals and ongoing caution about market and company-specific factors. The following summarizes key perspectives derived from recent research notes.
Bullish Takeaways- Bullish analysts continue to maintain positive ratings on ARC Resources, suggesting confidence in the company's operational execution and asset base, even amid price target adjustments.
- The inclusion of ARC Resources on Analyst Current Favorites lists signals that the stock is still seen as an attractive pick in the sector relative to peers.
- Gradual upward revisions in price targets by some analysts, despite modest increases, reflect confidence in ARC Resources’ capacity for stable cash flow generation and efficient cost management.
- Strong margin discipline and ongoing profitability improvements have also been highlighted as supportive of long-term valuation.
- Bearish analysts have adjusted their forecasts based on more conservative assumptions for revenue growth and profit margins. This has resulted in price target reductions.
- Concerns remain about the sustainability of current margin levels, as market volatility and input cost pressures may affect future earnings.
- The modest nature of revenue growth expectations reflects skepticism that ARC Resources will achieve outsized expansion in the near term, especially given macroeconomic uncertainties.
What's in the News
- ARC Resources Ltd. has been added to the FTSE All-World Index (USD) (Key Developments).
- The Board of Directors has authorized a new buyback plan, and the company announced a share repurchase program that could see up to 57,967,896 shares, or 9.97% of issued share capital, bought back and cancelled by September 7, 2026 (Key Developments).
- For the second quarter ended June 30, 2025, ARC Resources reported total production of 357,228 boe/day, up from 330,046 boe/day last year. Natural gas and crude oil production also saw year-over-year increases. NGLs production decreased slightly (Key Developments).
- ARC Resources revised 2025 consolidated production guidance upwards due to the Kakwa Acquisition. The company now expects total production between 385,000 and 395,000 boe/day and forecasts second-half output above 410,000 boe/day (Key Developments).
- From April 1, 2025 to June 30, 2025, ARC Resources repurchased 2,900,000 shares for CAD 81.81 million and completed the repurchase of 10,000,000 shares for CAD 266.7 million under a previously announced buyback plan (Key Developments).
Valuation Changes
- Fair Value Estimate: Decreased slightly from CA$33.82 to CA$33.03, reflecting a modest downward adjustment in overall valuation.
- Discount Rate: Narrowed from 6.28% to 6.11%, indicating a slightly lower perceived risk or cost of capital in analyst models.
- Revenue Growth Projection: Lowered marginally from 6.80% to 6.72% for upcoming periods.
- Net Profit Margin: Increased gently from 29.03% to 29.27%, suggesting expectations for improved profitability.
- Future Price-to-Earnings Ratio: Declined from 11.21x to 10.82x, which signals expectations for improved earnings or a lower valuation multiple.
Disclaimer
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