Archrock (AROC): A Fresh Look at Valuation Ahead of Anticipated Earnings and Analyst Optimism

Archrock (AROC) is catching investors’ attention ahead of its upcoming earnings report on October 28, with many watching for the company to deliver higher earnings and revenue compared to last year. The stock has also been trading at a discount to its peers. This could appeal to value-focused investors looking for potential upside.

See our latest analysis for Archrock.

Momentum has been building for Archrock, with the stock delivering a 3.87% gain over the past week and an 8% share price return over the last 90 days. While the year-to-date share price is nearly flat, long-term investors have seen a total shareholder return of nearly 29% over the past year and a striking 289% over three years. This reflects both steady business progress and growing optimism ahead of the company’s next earnings report.

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With Archrock trading at a discount and analyst confidence running high, investors are left to wonder if the current price signals an attractive buying opportunity or if the market has already accounted for its expected growth.

Most Popular Narrative: 18.3% Undervalued

With the narrative's fair value set at $30.89 and Archrock’s last close price of $25.24, the numbers suggest meaningful upside if analysts’ assumptions are met. The narrative highlights forces shaping long-term growth and sets the stage for key catalysts investors will want to understand.

Sustained investments in domestic energy production and infrastructure, bolstered by energy security priorities and manufacturing onshoring, are generating broad-based demand across major shale basins. This enables Archrock to expand geographically and diversify its customer base, reducing revenue volatility and supporting stable earnings.

Read the complete narrative.

Want to know what’s really fueling this valuation upgrade? A multi-year growth story is unfolding, driven by secular demand shifts and margin reinvention. The secret is that analysts are building their price target on bold forecasts for profit expansion most companies can only dream about. Get inside the narrative and see what kind of financial leap the consensus expects from Archrock before you decide if the buzz is justified.

Result: Fair Value of $30.89 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, Archrock’s future is not risk-free, as changes in US energy regulations or slower natural gas demand growth could undermine these bullish analyst forecasts.

Find out about the key risks to this Archrock narrative.

Another View: Multiples Send a Mixed Signal

While the fair value narrative implies Archrock is undervalued, our comparison to similar companies reveals a more nuanced picture. Archrock’s price-to-earnings ratio of 19.4x is higher than both the industry average of 15.1x and the fair ratio of 17.6x. Even so, it is less expensive than some direct peers at 39.9x. This suggests that investors may be paying a premium for its perceived growth and stability. The key question is whether the potential upside justifies that risk, or if the market is already pricing it in.

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Archrock Narrative

If you see things differently or want a fresh take based on your own insights, you can dive in and craft your own perspective in just minutes, and Do it your way

A great starting point for your Archrock research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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