Approach Resources Stock Analysis, Valuation (NASDAQ:AREX)

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$2.78 $0.04 (1.42%) AREX stock closing price Apr 19, 2018 (Closing)
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Approach Resources
Updated on : Apr 19, 2018
previous close
AREX 2.8 (0%)
S&P 500 2693.1 (0%)
Closing Price On: Apr 19, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Oil and Gas-US exploration and production
Sector :
Oils-Energy
5 Quarter Revenue
Revenue Growth
2017-Q4
$million
%
YOY GROWTH
Compared to the industry
Long Term Growth
5 Year CAGR:
-4%
Operating Profit
Operating Margin:
-18.7%
Sector Average:
5.8%
5 Quarter Net Profit
Net Margins
2017-Q4
%
LTM Margin
Cash Flow
Operating cash flow:
$7.9M
Net Income:
$45.8M
PROS      CONS
FCF Margin
Long Term Growth
Operating Margins
Net Margins
Cash Flow
ROIC
ROE
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
PE: N/A
AREX PS :
2.4
Industry PS :
1.8
Sector:   Oils-Energy.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
-1.3%
Return on Equity:
-19.9%
Free Cash Flow Margin:
23.1%
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Approach Resources Stock Analysis

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Take a look at Amigobulls Approach Resources stock analysis video. This video puts forward our latest analysis highlighting the pros and cons for AREX stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Approach Resources Inc. Stock Rating 2/5

Amigobulls AREX stock analysis relies on business fundamentals such as Approach Resources revenue growth, profits and return on equity measures from the latest quarter 2017 Q4 earnings. Approach Resources valuation analysis is based on relative valuation multiples like PE ratio and price to sales ratio. Approach Resources stock rating is our opinion about the business fundamentals of the company.

Should you buy AREX stock?

  • The company has a healthy free cash flow margin of 23.1%.

Should you sell AREX stock?

  • Sales declined by -4% annually over the last 5 years.
  • Approach Resources registered a negative operating margin of -18.7% (average) over the Trailing Twelve Months (TTM).
  • Approach Resources posted an average Net loss of -106.6% in the last twelve months.
  • Cash flow from operations is low at 0.2 times the net income.
  • PE ratio is meaningless for AREX stock as the company has losses.
  • Approach Resources's negative ROIC of -1.3% indicates operational inefficiency.
  • A negative ROE of -19.9% indicates that the company is not able to generate profits with the money shareholders have invested.

Comments on this video and Approach Resources stock

Investors can make use of the Amigobulls Approach Resources stock analysis to ascertain how AREX stock fares in fundamental analysis investment criteria. Company's fundamentals remain one of the key driver of AREX stock and helps investors in making good buy and sell decision.

Approach Resources revenue growth is an indicator of the demand for a company's products while profit margin is indicative of company's pricing power and pricing strategy. Investors could make use of AREX technical analysis to check whether the fundamental story is reflected in the market sentiment.