Archrock Inc. (AROC): A Growth Stock Worth Watching

Archrock Inc. (AROC) is a pure-play compression services company with a strong growth outlook. It has a Zacks Rank #3 (Hold), Growth Style Score of A, and VGM Score of A. Earnings are expected to grow 49.5% YoY for the current fiscal year, with sales growth of 28.7%. Two analysts revised their earnings upwards in the last 60 days, with an average earnings surprise of 6.5%. With solid fundamentals and top-tier Style Scores, AROC should be on investors' short lists.

Archrock Inc. (AROC), a pure-play compression services company, has been gaining attention from investors due to its robust growth outlook and solid fundamentals. The company, which operates primarily in the natural gas production, processing, and transportation sectors, has a Zacks Rank #3 (Hold), a Growth Style Score of A, and a VGM Score of A [1]. These scores indicate that Archrock is a strong candidate for growth investors.

For the current fiscal year, Archrock's earnings are expected to grow by 49.5% year-over-year (YoY), with sales growth projected at 28.7% [1]. Two analysts have revised their earnings estimates upwards in the last 60 days, with an average earnings surprise of 6.5% [1]. These positive revisions highlight the company's strong performance and the potential for further growth.

Archrock's operational transformation over the past decade has focused on improving performance, safety, customer service, and environmental responsibility. This strategic shift has positioned the company as a premier provider of natural gas compression services, supporting the growing demand for natural gas infrastructure.

The company's recent earnings report for the second quarter of 2025 exceeded Wall Street expectations, with earnings per share (EPS) of $0.39, slightly above the forecast of $0.38 [3]. Additionally, the company reported a revenue of $383.2 million, which was higher than the predicted $364.08 million [3]. Despite the positive earnings surprise, Archrock's stock experienced a decline post-earnings, closing at $22.81 and continuing to drop in premarket activities [3].

Archrock's stock has been the subject of several analyst reports. Sidoti raised Archrock to a "hold" rating, while Evercore ISI dropped their price objective to $31.00 and set an "outperform" rating [2]. Overall, the stock has a consensus rating of "Moderate Buy" and a consensus target price of $28.40 [2].

Institutional investors have shown interest in Archrock, with several major players increasing their stakes in the company. Jefferies Financial Group Inc. acquired a new stake in Archrock in the first quarter of 2025, while LPL Financial LLC, JPMorgan Chase & Co., Pictet Asset Management Holding SA, Alliancebernstein L.P., and Geode Capital Management LLC have also boosted their holdings [2].

Archrock's recent dividend increase, from $0.19 to $0.21 per share, represents a positive change for shareholders [2]. The company's payout ratio is currently 63.64%, indicating that it has room to increase its dividend in the future.

Archrock's stock buyback plan, which authorizes the company to buyback $50.00 million in outstanding shares, is another positive sign for investors. This move suggests that the company's board believes its stock is undervalued [2].

In conclusion, Archrock Inc. (AROC) presents a compelling investment opportunity for growth-oriented investors. With strong fundamentals, a top-tier Growth Style Score, and a robust growth outlook, the company is well-positioned to continue its positive performance. However, investors should monitor the company's stock price and earnings reports closely to make informed decisions.

References:
[1] https://finance.yahoo.com/news/growth-investor-1-stock-could-134501776.html
[2] https://www.marketbeat.com/instant-alerts/filing-17613-shares-in-archrock-inc-nysearoc-acquired-by-jefferies-financial-group-inc-2025-08-07/
[3] https://www.investing.com/news/transcripts/earnings-call-transcript-archrock-inc-q2-2025-beats-forecasts-stock-dips-93CH-4171121