Archrock (AROC) Stock Analysis & Winston Score

Archrock is a US company that rents out natural gas compression equipment to oil and gas producers. Compression equipment is used to push natural gas through pipelines so it can be transported and sold. Archrock is the largest provider of contract compression services in the United States.

The company makes money by charging customers a monthly fee to use its compression equipment, which it also operates and maintains. This contract-based model creates steady, recurring revenue. Archrock operates almost entirely in the US, focusing on major producing regions like the Permian Basin and Appalachia. Its large installed fleet and long-term customer contracts give it a durable competitive position. The main growth driver is rising US natural gas production, particularly demand tied to LNG exports, but the business is exposed to a slowdown in drilling activity if energy prices fall sharply.

Winston Score History

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Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+7.7% YoY

YoY Growth Rate

Slow revenue growth

EPS Growth

+2.5% YoY

YoY Growth Rate

Slow EPS growth

Insider Activity

2.7%ownership

Relatively low insider ownership

Cash Position

Cash flow positive

$4M cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Growth context

Archrock is growing revenue at 8% year-over-year. The Winston Score measures business quality today — these growth metrics show what could matter tomorrow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Gross Margin

47.5%

Healthy — 47.5% gross margin

Operating Margin

35.4%

Excellent — 35.4% operating margin

ROCE

3.4%

Weak — 3.4% return on capital

ROIC between 0% and 5%. They earn a few cents back per dollar invested in the business.

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Growth

Sales YoY

+22.7%

Fast-growing sales (22.7% YoY)

EPS YoY

+55.9%

Earnings growing fast (55.9% YoY)

Earnings growing 25%+ a year. The compounder zone.

EPS Consistency

8/8 quarters

Every recent quarter grew earnings vs last year

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Cash Flow

Cash Conversion

213%

Turns 213% of profit into real cash

FCF Margin

16.1%

Converts sales into free cash efficiently (16.1%)

FCF margin between 10% and 20%. Every $100 in sales becomes $10 to $20 in real cash.

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Stability

Debt / Equity

1.57

Elevated debt (1.57)

Interest Cover

3.08x

Tight — interest eats into profit (3.1x)

Interest coverage between 3 and 8. Profits cover interest several times over.

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Valuation

P/E Ratio (TTM)

20.7x

no trend

Growth-priced — P/E 20.7

P/E above the market average. People are paying up for expected growth.

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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