Contrasting Alpha Metallurgical Resources (NYSE:AMR) and Ferroglobe (NASDAQ:GSM)

Alpha Metallurgical Resources (NYSE:AMR) and Ferroglobe (NASDAQ:GSM) are both small-cap basic materials companies, but which is the better business? We will contrast the two businesses based on the strength of their analyst recommendations, profitability, valuation, institutional ownership, dividends, risk and earnings.

Risk & Volatility

Alpha Metallurgical Resources has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500. Comparatively, Ferroglobe has a beta of 1.62, meaning that its share price is 62% more volatile than the S&P 500.

Profitability

This table compares Alpha Metallurgical Resources and Ferroglobe’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Alpha Metallurgical Resources	-1.57%	-2.28%	-1.54%
Ferroglobe	-6.99%	-2.85%	-1.51%

Insider and Institutional Ownership

84.3% of Alpha Metallurgical Resources shares are owned by institutional investors. Comparatively, 89.6% of Ferroglobe shares are owned by institutional investors. 16.0% of Alpha Metallurgical Resources shares are owned by insiders. Comparatively, 13.1% of Ferroglobe shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Analyst Recommendations

This is a breakdown of current recommendations for Alpha Metallurgical Resources and Ferroglobe, as provided by MarketBeat.com.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Alpha Metallurgical Resources	0	2	1	0	2.33
Ferroglobe	0	1	0	0	2.00

Alpha Metallurgical Resources presently has a consensus price target of $160.50, suggesting a potential upside of 9.63%. Given Alpha Metallurgical Resources’ stronger consensus rating and higher probable upside, research analysts plainly believe Alpha Metallurgical Resources is more favorable than Ferroglobe.

Valuation & Earnings

This table compares Alpha Metallurgical Resources and Ferroglobe”s gross revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Alpha Metallurgical Resources	$2.96 billion	0.65	$187.58 million	($2.85)	-51.37
Ferroglobe	$1.40 billion	0.56	$23.54 million	($0.57)	-7.39

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

Summary

Alpha Metallurgical Resources beats Ferroglobe on 9 of the 14 factors compared between the two stocks.

About Alpha Metallurgical Resources

Alpha Metallurgical Resources, Inc., a mining company, produces, processes, and sells met and thermal coal in Virginia and West Virginia. The company offers metallurgical coal products. It operates twenty-two active mines and nine coal preparation and load-out facilities. The company was formerly known as Contura Energy, Inc. and changed its name to Alpha Metallurgical Resources, Inc. in February 2021. Alpha Metallurgical Resources, Inc. was incorporated in 2016 and is headquartered in Bristol, Tennessee.

About Ferroglobe

Ferroglobe PLC produces and sells silicon metal, and silicon and manganese-based ferroalloys in the United States, Europe, and internationally. It provides silicone chemicals that are used in a range of applications, including personal care items, construction-related products, health care products, and electronics; and silicon metal for primary and secondary aluminum producers. The company also offers silicomanganese, which is used as deoxidizing agent in the steel manufacturing process; and ferromanganese that is used as a deoxidizing, desulphurizing, and degassing agent in the removal of nitrogen and other harmful elements from steel. In addition, it offers ferrosilicon products that are used to produce stainless steel, carbon steel, and various other steel alloys, as well as to manufacture electrodes and aluminum; calcium silicon, which is used in the deoxidation and desulfurization of liquid steel, and production of coatings for cast iron pipes, as well as in the welding process of powder metal and in pyrotechnics; and nodularizers and inoculants, which are used in the production of iron. Further, the company provides silica fume, a by-product of the electrometallurgical process of silicon metal and ferrosilicon. Additionally, it operates quartz mines in South Africa, Spain, the United States, and Canada; and low-ash metallurgical coal mines in the United States; and a charcoal production facility in South Africa, as well as holds interests in hydroelectric power plant in France. The company serves silicone chemical producers; aluminum and steel manufacturers; auto companies and their suppliers; ductile iron foundries; manufacturers of photovoltaic solar cells and computer chips; and concrete producers. Ferroglobe PLC was formerly known as VeloNewco Limited and changed its name to Ferroglobe PLC in December 2015. The company was incorporated in 2015 and is headquartered in London, the United Kingdom.