Value
7.4/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.1 |
| P/S | 5.3 |
| Fwd P/E | 8.7 |
| PEG | 10.0 |
| Analyst target | 5.0 |
- ▸Forward P/E: 12.9x
- ▸PEG: 0.05
- ▸Attractively valued
AM · Why this verdict
Why Antero Midstream (AM) is rated BUY WAIT
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictBUY WAIT
Overall score6.4/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Antero Midstream is a high-return, 50%-margin midstream business with a 4.2% dividend, but it depends on one customer, has missed earnings three straight quarters, and trades above its analyst target.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Return on equity of 32% and margins of 50% with a wide moat and a Rule of 40 score of 46 mark a high-quality midstream business. Quality breakdown | Margins stay above 40% over 12 months. | ↑Improving |
| CounterFree cash flow is only 68% of net income, a quality warning. | ||
Quarterly revenue rose from about $295M to $327M over five quarters. Earnings | Quarterly revenue exceeds $340M within 12 months. | ↑Improving |
| CounterRevenue growth depends on one producer's drilling activity. | ||
Antero Resources is the key customer, so volumes depend on a single producer. Bear case | Contract volumes with the main customer stay stable. | ↑Improving |
| CounterA reduction in drilling plans would cut volumes and revenue directly. | ||
EPS missed in each of the last three quarters, including a 23% miss in October 2026. Earnings | EPS returns to beats at the February 2027 report. | ↑Improving |
| CounterThree consecutive and growing misses suggest estimates are too optimistic. | ||
The $21.47 price is above the $20.88 analyst target by about 2.7%, leaving no upside to target. Targets | Targets are raised or the price pulls back. | ↑Improving |
| CounterA 4.2% dividend and a breakout setup may keep buyers interested. | ||
Return on equity of 32% and margins of 50% with a wide moat and a Rule of 40 score of 46 mark a high-quality midstream business.
↑ImprovingQuality breakdown
- Expectation
- Margins stay above 40% over 12 months.
CounterFree cash flow is only 68% of net income, a quality warning.
Quarterly revenue rose from about $295M to $327M over five quarters.
↑ImprovingEarnings
- Expectation
- Quarterly revenue exceeds $340M within 12 months.
CounterRevenue growth depends on one producer's drilling activity.
Antero Resources is the key customer, so volumes depend on a single producer.
↑ImprovingBear case
- Expectation
- Contract volumes with the main customer stay stable.
CounterA reduction in drilling plans would cut volumes and revenue directly.
EPS missed in each of the last three quarters, including a 23% miss in October 2026.
↑ImprovingEarnings
- Expectation
- EPS returns to beats at the February 2027 report.
CounterThree consecutive and growing misses suggest estimates are too optimistic.
The $21.47 price is above the $20.88 analyst target by about 2.7%, leaving no upside to target.
↑ImprovingTargets
- Expectation
- Targets are raised or the price pulls back.
CounterA 4.2% dividend and a breakout setup may keep buyers interested.
Per-dimension breakdown
Quality
7.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 5.1 |
| Gross margin | 10.0 |
| Op margin | 10.0 |
| Net margin | 10.0 |
| Current ratio | 3.4 |
| FCF quality | 5.2 |
| Moat | 7.5 |
| Rule of 40 | 7.7 |
| Piotroski F | 7.8 |
- ▸Excellent ROE: 32%
- ▸Strong margins: 50%
- ▸Earnings quality warning: 68% FCF/NI
- ▸Wide economic moat
Growth
7.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.5 |
| EPS growth | 10.0 |
Momentum
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 8.5 |
| OBV | 10.0 |
| MA position | 5.2 |
| Volume | 4.9 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA but MA still rising (+2.6%/30d) — pullback in uptrend, not confirmed weakness
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 8.0 |
| Analyst rating | 5.0 |
| Price target | 7.1 |
- ▸LLM news sentiment: +0.60 (n=1)
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
- ▸Negligible insider selling — $106,350 (0.001% of mkt cap)
Peer rank
4.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.7 |
| quality rank | 7.8 |
| growth rank | 2.6 |
- ▸Best-in-class margins
Technical
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 3.5 |
| support resistance | 3.9 |
| 52w position | 8.1 |
Risk (lower is worse)
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.9 |
| days to cover | 5.6 |
| volatility | 5.1 |
| put call | 10.0 |
| implied vol | 5.8 |
| max pain risk | 3.0 |
| beta | 8.9 |
| debt equity | 4.1 |
- ▸Above max pain $13
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 4.2 |
| news activity | 5.0 |
- ▸Earnings concerns: 1B/3M
- ▸Dividend: 4.3%
How the verdict was assembled
Engine trigger
Fundamentals strong but target reached (0.3% upside).
Engine technical detail
verdict_path:
L4:PATH_C2_GARP|V8:TARGET_REACHED|ENTRY_STICKY:WITHIN_BANDPassed (7)
- MOMENTUM:6.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_BOOST:ANALYST:0.60
- EARNINGS_PROXIMITY:99d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:0.0<1.5@spot
Warning (0)
none
Reward-to-Risk
0.04
Upside
+0.3%
Downside
7.4%
Sizing output
STARTER
SetupRange Bound — RSI 55 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The C-path quality+growth combination triggered the STRONG_BUY_WAIT verdict: quality 7.7 and growth 7.8 both clear their thresholds, with asymmetric R:R of 0.04 supporting the read.
The strongest dimensions are Growth at 7.8, Quality at 7.7, and Value at 7.4; the weakest are Catalyst at 3.2, Peer rank at 4.2, and Insider at 5.0. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of 0.04 and an engine sizing output of STARTER.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Margin High Return
Trip ifNet margin falls below 35% from about 50%.
- P2Steady Revenue Growth
Trip ifQuarterly revenue falls below $300M.
- P3Customer Concentration
Trip ifShare of revenue from Antero Resources exceeds 95%.
- P4Earnings Misses
Trip ifEPS surprise stays below 0% for 2 more quarters.
- P5Price Above Analyst Target
Trip ifPrice exceeds the analyst target by more than 15%.