Archrock, Inc. (NYSE:AROC) missed earnings with its latest quarterly results, disappointing overly-optimistic forecasters. Archrock missed earnings this time around, with US$371m revenue coming in 6.0% below what the analysts had modelled. Statutory earnings per share (EPS) of US$0.38 also fell short of expectations by 16%. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Archrock after the latest results.

Following last week's earnings report, Archrock's five analysts are forecasting 2026 revenues to be US$1.53b, approximately in line with the last 12 months. Statutory earnings per share are expected to dip 4.8% to US$1.76 in the same period. In the lead-up to this report, the analysts had been modelling revenues of US$1.56b and earnings per share (EPS) of US$1.86 in 2026. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a small dip in earnings per share estimates.

Despite the cuts to forecast earnings, there was no real change to the US$42.88 price target, showing that the analysts don't think the changes have a meaningful impact on its intrinsic value. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. There are some variant perceptions on Archrock, with the most bullish analyst valuing it at US$46.00 and the most bearish at US$40.00 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. It's pretty clear that there is an expectation that Archrock's revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 2.8% growth on an annualised basis. This is compared to a historical growth rate of 15% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 6.9% annually. So it's pretty clear that, while revenue growth is expected to slow down, the wider industry is also expected to grow faster than Archrock.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$42.88, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Archrock. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Archrock going out to 2028, and you can see them free on our platform here..

You should always think about risks though.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.