Investment Thesis
ArcBest is operationally unprofitable with net losses despite nearly $1B in revenue, indicating severe margin compression in the trucking sector. Critical coverage and liquidity ratios—interest coverage of 0.8x and current ratio of 0.93x—reveal the company cannot sustain current debt levels or meet near-term obligations from operational cash generation.
Strengths
- Moderate leverage at 0.10x debt-to-equity ratio limits balance sheet deterioration risk
- Substantial $2.5B asset base provides residual liquidation value and potential recovery platform
- Positive $8.5M operating cash flow demonstrates core operations still generate cash despite net losses
Risks
- Negative net income with -0.1% net margin indicates structural unprofitability unsustainable beyond near-term
- Current ratio of 0.93x signals acute liquidity stress with current liabilities exceeding current assets
- Interest coverage of 0.8x means operating income cannot service debt obligations, creating refinancing and default risk
- Negative free cash flow of -$1.2M indicates capital consumption despite positive OCF
- Revenue declining 4.0% YoY suggests deteriorating demand or competitive pressures
Key Metrics to Watch
- Operating margin recovery toward sustainable positive levels (currently 0.3%)
- Interest coverage ratio improvement above 1.5x minimum covenant threshold
- Current ratio stabilization above 1.0x and cash balance depletion trajectory
- Free cash flow inflection and capital expenditure sustainability
Financial Metrics
Revenue
998.8M
Net Income
-1.0M
EPS (Diluted)
$-0.05
Free Cash Flow
-1.2M
Total Assets
2.5B
Cash
64.1M
Profitability Ratios
Gross Margin
N/A
Operating Margin
0.3%
Net Margin
-0.1%
ROE
-0.1%
ROA
0.0%
FCF Margin
-0.1%
Balance Sheet & Liquidity
Current Ratio
0.93x
Quick Ratio
0.93x
Debt/Equity
0.10x
Debt/Assets
0.0%
Interest Coverage
0.82x
Long-term Debt
129.6M
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-06T12:41:19.267153 |
Data as of: 2026-03-31 |
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