ARC Document Solutions Inc

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ARC : NYSE : Services
$3.51 -0.09 | -2.5%
Today's Range: 3.5 - 3.59
Avg. Daily Volume: 105200.0
08/23/17 - 4:02 PM ET

Financial Analysis


ARC DOCUMENT SOLUTIONS INC's gross profit margin for the second quarter of its fiscal year 2017 is essentially unchanged when compared to the same period a year ago. Even though sales decreased, the net income has increased. ARC DOCUMENT SOLUTIONS INC has average liquidity. Currently, the Quick Ratio is 1.29 which shows that technically this company has the ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

During the same period, stockholders' equity ("net worth") has increased by 9.26% from the same quarter last year. Together, the key liquidity measurements indicate that it is relatively unlikely that the company will face financial difficulties in the near future.

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Income Statement Q2 FY17 Q2 FY16
Net Sales ($mil)102.28103.77
EBITDA ($mil)16.2117.55
EBIT ($mil)7.859.66
Net Income ($mil)3.64-55.9


Balance Sheet Q2 FY17 Q2 FY16
Cash & Equiv. ($mil)26.620.45
Total Assets ($mil)371.38400.48
Total Debt ($mil)151.97164.92
Equity ($mil)157.92144.54


Profitability Q2 FY17 Q2 FY16
Gross Profit Margin40.8341.49
EBITDA Margin15.8416.9
Operating Margin7.689.31
Sales Turnover1.081.04
Return on Assets2.937.49
Return on Equity6.8920.76
Debt Q2 FY17 Q2 FY16
Current Ratio1.731.65
Debt/Capital0.490.53
Interest Expense1.591.53
Interest Coverage4.936.33


Share Data Q2 FY17 Q2 FY16
Shares outstanding (mil)46.4446.01
Div / share0.00.0
EPS0.08-1.22
Book value / share3.43.14
Institutional Own % n/a n/a
Avg Daily Volume104304.0132747.0

Valuation


HOLD. The current P/E ratio indicates a significant discount compared to an average of 32.30 for the Commercial Services & Supplies industry and a discount compared to the S&P 500 average of 24.23. For additional comparison, its price-to-book ratio of 1.06 indicates a significant discount versus the S&P 500 average of 3.02 and a significant discount versus the industry average of 6.04. The price-to-sales ratio is well below both the S&P 500 average and the industry average, indicating a discount. Upon assessment of these and other key valuation criteria, ARC DOCUMENT SOLUTIONS INC proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ARC 15.04 Peers 32.30   ARC 2.94 Peers 19.01

Discount. A lower P/E ratio than its peers can signify a less expensive stock or lower growth expectations.

ARC is trading at a significant discount to its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ARC is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ARC 14.16 Peers 25.76   ARC NM Peers 1.40

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

ARC is trading at a significant discount to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ARC's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ARC 1.06 Peers 6.04   ARC -58.63 Peers 133.38

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ARC is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, ARC is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ARC 0.42 Peers 2.46   ARC -4.37 Peers 14.35

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ARC is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ARC significantly trails its peers on the basis of sales growth

 

 

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