Arc Resources(ARX:TSX) Cormark Securities lifts target to $24 from $21

STA Research
by: STA Research

 Cormark Securities lifted the target on Arc Resources to $24 from $21, and maintained the Outperform rating on the company’s stock price.

Based on the ARC Resources Ltd stock forecasts from 10 analysts, the average analyst target price for ARC Resources Ltd is CAD 13.47 over the next 12 months. ARC Resources Ltd’s average analyst rating is . Stock Target Advisor’s own stock analysis of ARC Resources Ltd is Slightly Bullish , which is based on 6 positive signals and 5 negative signals. At the last closing, ARC Resources Ltd’s stock price was CAD 15.58. ARC Resources Ltd’s stock price has changed by -0.39% over the past week, +1.18% over the past month and +98.47% over the last year.

ARC Resources Ltd. explores, develops, and produces crude oil, natural gas, and natural gas liquids in Canada. The company holds interests in the Montney properties located in northeast British Columbia and northern Alberta; and Pembina Cardium properties in central Alberta. As of December 31, 2020, it had proved plus probable reserves of 929 millions of barrels of oil equivalent. ARC Resources Ltd. was founded in 1996 and is headquartered in Calgary, Canada. Address: 308 – 4th Avenue South West, Calgary, AB, Canada.

What we like:

High market capitalization

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Low volatility

The stock’s annual returns have been stable and consistent compared to its sector peers(for a hold period of at least 12 months) and is in the top quartile. Although stability is good, also keep in mind it can limit returns.

Superior total returns

The stock has outperformed its sector peers on average annual total returns basis in the past 5 years (for a hold period of at least 12 months) and is in the top quartile.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

Superior Revenue Growth

This stock has shown top quartile revenue growth in the previous 5 years compared to its sector.

What we don’t like:

Poor risk adjusted returns

This company is delivering below median risk adjusted returns in its peers. Even if it is outperforming on returns , the returns are unpredictable. Proceed with caution.

Below median dividend returns

The company’s average income yield over the past 5 years has been low compared to its peers. However, it is not a problem if you are not looking for income.

Overpriced compared to earnings

The stock is trading high compared to its peers on a price to earning basis and is above the sector median.

Overpriced compared to book value

The stock is trading high compared to its peers median on a price to book value basis.

Poor return on equity

The company management has delivered below median return on equity in the most recent 4 quarters compared to its peers.

 

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