Financial Review: Ramaco Resources (NASDAQ:METC) and American Resources (NASDAQ:AREC)

Ramaco Resources (NASDAQ:METCGet Rating) and American Resources (NASDAQ:ARECGet Rating) are both small-cap oils/energy companies, but which is the better business? We will compare the two companies based on the strength of their risk, analyst recommendations, institutional ownership, earnings, valuation, dividends and profitability.

Insider and Institutional Ownership

63.8% of Ramaco Resources shares are held by institutional investors. Comparatively, 8.3% of American Resources shares are held by institutional investors. 52.9% of Ramaco Resources shares are held by company insiders. Comparatively, 27.9% of American Resources shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company will outperform the market over the long term.

Risk and Volatility

Ramaco Resources has a beta of 1.1, meaning that its stock price is 10% more volatile than the S&P 500. Comparatively, American Resources has a beta of -0.28, meaning that its stock price is 128% less volatile than the S&P 500.

Profitability

This table compares Ramaco Resources and American Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ramaco Resources 14.03% 20.80% 14.25%
American Resources -417.68% N/A -67.86%

Analyst Recommendations

This is a breakdown of recent ratings and target prices for Ramaco Resources and American Resources, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ramaco Resources 0 2 1 0 2.33
American Resources 0 0 1 0 3.00

Ramaco Resources presently has a consensus target price of $19.67, indicating a potential upside of 23.77%. American Resources has a consensus target price of $4.50, indicating a potential upside of 148.62%. Given American Resources’ stronger consensus rating and higher probable upside, analysts plainly believe American Resources is more favorable than Ramaco Resources.

Earnings & Valuation

This table compares Ramaco Resources and American Resources’ gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Ramaco Resources $283.39 million 2.48 $39.76 million $0.91 17.46
American Resources $7.76 million 15.33 -$32.50 million ($0.60) -3.02

Ramaco Resources has higher revenue and earnings than American Resources. American Resources is trading at a lower price-to-earnings ratio than Ramaco Resources, indicating that it is currently the more affordable of the two stocks.

Summary

Ramaco Resources beats American Resources on 9 of the 12 factors compared between the two stocks.

About Ramaco Resources (Get Rating)

Ramaco Resources, Inc. produces and sells metallurgical coal. The company's development portfolio includes the Elk Creek project consisting of approximately 20,200 acres of controlled mineral and 16 seams located in southern West Virginia; the Berwind property comprising approximately 41,300 acres of controlled mineral and an area of Squire Jim seam coal deposits, which is situated on the border of West Virginia and Virginia; the Knox Creek property consisting of approximately 62,100 acres of controlled mineral that is located in Virginia; and the RAM Mine property comprising approximately 1,570 acres of controlled mineral, which is situated in southwestern Pennsylvania. The company serves blast furnace steel mills and coke plants in the United States, as well as international metallurgical coal consumers. The company was founded in 2015 and is headquartered in Lexington, Kentucky.

About American Resources (Get Rating)

American Resources Corporation engages in the extraction, processing, transportation, distribution, and sale of metallurgical coal to the steel industries. The company supplies raw materials; and sells coal used in pulverized coal injections. It has a portfolio of operations located in the Pike, Knott, and Letcher Counties in Kentucky; and Wyoming County, West Virginia. American Resources Corporation was founded in 2006 and is headquartered in Fishers, Indiana.

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