Archrock (NYSE:AROC) Issues Earnings Results

Key Points

• Archrock reported earnings of $0.39 per share for the quarter, exceeding analysts' estimates of $0.38 by $0.01.
• The company announced a quarterly dividend increase to $0.21 per share, yielding 3.7%, with an ex-dividend date of August 5th.
• Archrock initiated a $50 million share repurchase program, indicating management's belief that their shares are undervalued.

Archrock (NYSE:AROC - Get Free Report) announced its earnings results on Monday. The energy company reported $0.39 EPS for the quarter, beating the consensus estimate of $0.37 by $0.02, Zacks reports. Archrock had a net margin of 17.17% and a return on equity of 19.05%. The company had revenue of $383.15 million during the quarter, compared to the consensus estimate of $366.34 million. During the same quarter in the prior year, the company posted $0.23 earnings per share. The firm's revenue for the quarter was up 41.6% on a year-over-year basis.

Archrock Stock Performance

AROC traded up $0.79 during midday trading on Wednesday, hitting $22.79. 1,124,810 shares of the company traded hands, compared to its average volume of 1,418,400. The company has a quick ratio of 0.96, a current ratio of 1.47 and a debt-to-equity ratio of 1.70. The firm has a market capitalization of $4.03 billion, a PE ratio of 17.26, a price-to-earnings-growth ratio of 1.23 and a beta of 1.10. The company's 50-day moving average is $24.23 and its 200 day moving average is $25.18. Archrock has a 52 week low of $18.38 and a 52 week high of $30.44.

Archrock Increases Dividend

The business also recently announced a quarterly dividend, which will be paid on Tuesday, August 12th. Shareholders of record on Tuesday, August 5th will be paid a dividend of $0.21 per share. The ex-dividend date is Tuesday, August 5th. This represents a $0.84 annualized dividend and a yield of 3.7%. This is an increase from Archrock's previous quarterly dividend of $0.19. Archrock's dividend payout ratio (DPR) is currently 64.41%.

Archrock declared that its board has initiated a stock buyback plan on Monday, May 5th that authorizes the company to buyback $50.00 million in outstanding shares. This buyback authorization authorizes the energy company to reacquire up to 1.2% of its stock through open market purchases. Stock buyback plans are often a sign that the company's board believes its shares are undervalued.

Analysts Set New Price Targets

A number of equities analysts have weighed in on the stock. Evercore ISI cut their target price on shares of Archrock from $32.00 to $31.00 and set an "outperform" rating for the company in a research report on Wednesday. Sidoti raised shares of Archrock to a "hold" rating in a research report on Wednesday, May 7th. One investment analyst has rated the stock with a hold rating and five have issued a buy rating to the company. Based on data from MarketBeat.com, the stock presently has a consensus rating of "Moderate Buy" and an average price target of $28.40.

Insider Buying and Selling at Archrock

In other news, SVP Jason Ingersoll sold 42,036 shares of the stock in a transaction that occurred on Friday, May 9th. The shares were sold at an average price of $24.49, for a total value of $1,029,461.64. Following the transaction, the senior vice president owned 275,911 shares in the company, valued at $6,757,060.39. This represents a 13.22% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. 2.60% of the stock is owned by company insiders.

Hedge Funds Weigh In On Archrock

An institutional investor recently raised its position in Archrock stock. Jones Financial Companies Lllp increased its position in Archrock, Inc. (NYSE:AROC - Free Report) by 217.9% in the 1st quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The institutional investor owned 1,316 shares of the energy company's stock after acquiring an additional 902 shares during the quarter. Jones Financial Companies Lllp's holdings in Archrock were worth $35,000 at the end of the most recent quarter. Institutional investors own 95.45% of the company's stock.

Archrock Company Profile

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.