Archrock: A New Era Of Dividend Growth Is Afoot

Dec. 01, 2022 4:05 AM ETArchrock, Inc. (AROC)23 Comments
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DT Analysis


  • There were many tough years for Archrock during the past decade as the United States natural gas industry endured a volatile ride.
  • Management recently flagged that higher shareholder returns could be forthcoming from next year onwards, potentially ending their three-year-long dividend growth pause.
  • Notwithstanding their high capital expenditure in 2021, they still have ample scope for dividend growth as their dividend payments are relatively modest versus their operating cash flow.
  • Plus, the bullish outlook for natural gas production in the United States following the Russia-Ukraine war could turbocharge their dividend growth.
  • Since it seems a new era of dividend growth is afoot, I believe their high 6%+ yield makes a buy rating appropriate.

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The last decade was volatile and more often than not, a tough time for the natural gas industry in the United States, much to the discomfort of compression equipment suppliers, such as the large industry

Archrock Rating


Archrock Cash Flows


Archrock Operating Cash Flow


Archrock Capital Structure


Archrock Leverage


Archrock Debt Serviceability


Archrock Liquidity


Archrock Debt Structure

Archrock Q3 2022 10-Q

This article was written by

DT Analysis profile picture
My analysis primarily focuses on income investments with a preference for those sporting high and very high yields.  This space often contains value traps, although it also contains very desirable opportunities that have the potential to generate significant alpha for investors.  I endeavor to help investors make their own investment selections by providing my insights into financial information released by companies in the context of the current economic outlook.  Whilst I offer ratings via this site, these should not be taken as financial advice nor to proceed with a particular investment.  Apart from my extensive personal investment experience that spans over a decade, I have also obtained a Bachelor degree with Honours majoring in Finance, minoring in Accounting.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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