Ramaco Resources (METC) AI Stock Analysis

• Market Cap: $444.69M
• Dividend Yield: 6.49%
• Average Volume (3M): 515.90K
• Price to Earnings (P/E): 12.3
• Beta (1Y): 0.69
• Revenue Growth: 11.52%
• EPS Growth: -52.26%
• Country: US
• Employees: 811
• Sector: Basic Materials
• Sector Strength: 56
• Industry: Steel
• EPS (TTM): 0.69
• Shares Outstanding: 43,797,443
• 10 Day Avg. Volume: 570,525
• 30 Day Avg. Volume: 515,900
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.66
• Price to Cash Flow (P/CF): 3.10
• P/FCF Ratio: 5.90
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $13.00
• Price Target Upside: 54.76% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

Ramaco Resources is positioned with a stable financial outlook and positive operational performance, despite current market challenges. While technical indicators suggest caution, the company's strategic initiatives and solid dividend yield provide a balanced investment case.

Ramaco Resources Business Overview & Revenue Model

Company Description

Ramaco Resources, Inc. (METC) is a U.S.-based company engaged in the production and sale of metallurgical coal. The company primarily operates in the Appalachian regions, supplying high-quality metallurgical coal to steel manufacturers. Its operations are focused on the development and mining of coal properties in areas such as West Virginia, Virginia, and Pennsylvania. Ramaco Resources emphasizes efficiency and cost-effectiveness in its mining operations, aiming to provide competitive products to the domestic and international steel markets.

How the Company Makes Money

Ramaco Resources generates revenue primarily through the mining and sale of metallurgical coal, which is a critical component used in steel production. The company operates several mining complexes where it extracts, processes, and ships coal to steel manufacturers. Revenue streams include long-term supply agreements and spot market sales, with pricing often influenced by global steel demand and coal market conditions. Additionally, Ramaco may engage in export sales, depending on market opportunities and international demand. The company's profitability is influenced by coal production costs, transportation logistics, and market pricing dynamics.

Ramaco Resources Financial Statement Overview

Summary

Ramaco Resources presents a generally stable financial outlook with positive revenue growth and efficient cash flow management, despite some pressure on profit margins and returns. The company maintains a strong balance sheet with manageable debt levels, positioning it well in the steel industry. However, declining margins and return on equity are areas to monitor.

Income Statement

The income statement shows robust revenue growth with a TTM (Trailing-Twelve-Months) revenue of $698 million, a slight increase from the previous annual revenue of $693 million. Gross profit margin decreased from 28.8% last year to 18.7% TTM, indicating higher cost pressures. The net profit margin also declined from 11.9% to 5.4%, reflecting reduced profitability. Despite this, the company maintains positive EBIT and EBITDA margins at 6.8% and 16.1% TTM, respectively, though both have dropped compared to the previous year.

Balance Sheet

The balance sheet remains stable with a debt-to-equity ratio of 0.25, showing manageable leverage. Equity ratio is solid at 56.1%, indicating a strong equity base. However, return on equity has decreased to 10.3% TTM from 22.3% previously, suggesting less efficient use of equity. Overall, the company maintains a healthy financial position with sufficient equity backing.

Cash Flow

Cash flow analysis reveals strong operating cash flow of $138 million TTM, though slightly lower than $161 million previously. Free cash flow is healthy at $75 million TTM, highlighting effective capital management. The operating cash flow to net income ratio remains robust at 3.71, showcasing efficient cash generation relative to earnings. Free cash flow to net income ratio of 2.00 further emphasizes strong cash conversion.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
698.13M	693.52M	565.69M	283.39M	168.91M	230.21M
	Gross Profit
130.52M	199.73M	232.73M	87.98M	23.41M	67.74M
	EBIT
47.53M	95.25M	150.39M	39.53M	-7.17M	29.53M
	EBITDA
111.91M	150.90M	192.70M	73.78M	14.31M	49.56M
	Net Income Common Stockholders
37.37M	82.31M	116.04M	39.76M	-4.91M	24.93M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
6.95M	41.96M	35.61M	21.89M	5.30M	5.53M
	Total Assets
188.24M	665.84M	596.34M	329.03M	228.62M	226.81M
	Total Debt
9.47M	100.55M	138.11M	51.44M	17.45M	12.95M
	Net Debt
2.52M	58.59M	102.50M	29.55M	12.15M	7.42M
	Total Liabilities
47.13M	296.23M	287.14M	117.96M	59.53M	56.73M
	Stockholders Equity
141.11M	369.61M	309.20M	211.07M	169.09M	170.08M
Cash Flow		Free Cash Flow
74.93M	78.13M	64.86M	23.87M	-11.44M	-3.34M
	Operating Cash Flow
138.54M	161.04M	187.87M	53.34M	13.31M	42.38M
	Investing Cash Flow
-72.55M	-72.21M	-145.71M	-59.61M	-24.75M	-45.72M
	Financing Cash Flow
-86.10M	-82.52M	-28.50M	22.37M	11.29M	2.83M

Ramaco Resources Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 8.40
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For METC, the sentiment is Negative. The current price of 8.4 is below the 20-day moving average (MA) of 9.38, below the 50-day MA of 9.54, and below the 200-day MA of 11.23, indicating a bearish trend. The MACD of -0.33 indicates Positive momentum. The RSI at 35.21 is Neutral, neither overbought nor oversold. The STOCH value of 17.93 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for METC.

Ramaco Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ARLP	78 Outperform	$3.19B	8.95	19.34%	11.28%	-4.60%	-42.35%
METC	72 Outperform	$444.69M	12.28	10.46%	6.49%	11.52%	-52.26%
BTU	71 Outperform	$1.52B	4.62	10.41%	2.40%	-14.50%	-46.36%
CNR	70 Outperform	$3.64B	7.01	19.67%	0.74%	-13.20%	-51.56%
HCC	69 Neutral	$2.46B	9.77	12.64%	0.68%	-9.10%	-47.93%
AMR	60 Neutral	$1.73B	9.34	11.64%	0.36%	-14.81%	-71.49%
Sector *	47 Neutral	$2.64B	-4.00	-31.55%	3.33%	2.93%	-29.90%

Ramaco Resources Corporate Events

Ramaco Resources Raises $57.5M Through Senior Notes

Ramaco Resources, Inc. completed an offering of $57.5 million in aggregate principal amount of 8.375% Senior Notes due 2029, including the exercise of an over-allotment option. The proceeds from this offering will be used for general corporate purposes, including funding future investments and capital expenditures. The Notes, which are rated ‘BBB’ by Egan-Jones Ratings Company, bear interest payable quarterly and are listed on the Nasdaq Global Select Market under the symbol ‘METCZ’.

Ramaco Resources Announces Stock Dividend and Growth Plans

Ramaco Resources announced a stock dividend of $0.1375 per share of Class A common stock, payable in Class B stock, alongside their 2025 guidance. They expect production and sales growth, forecasting 4.4-4.8 million tons in sales and 4.2-4.6 million tons in production, with significant commitments already secured. Financially, they anticipate costs between $97-$103 per ton and capital expenditures of $60-$70 million, despite inflationary pressures. Investors can expect strategic growth, particularly at Elk Creek and Berwind complexes.

Ramaco Resources Secures $50M Through Public Offering

Ramaco Resources, Inc. completed a $50 million public offering of 8.375% senior unsecured notes due 2029, with interest payable quarterly. The notes, rated ‘BBB’ by Egan-Jones Ratings, offer investors a potential opportunity to earn steady returns. Proceeds will be used for corporate purposes, and the company has applied to list the notes on Nasdaq. The offering, led by Lucid Capital Markets, features a redemption option post-2026, presenting a flexible investment option for those interested in the financial markets.

Ramaco Resources Announces Fourth-Quarter Stock Dividend

Ramaco Resources announced a fourth-quarter stock dividend for its Class A and B shares, payable in Class B common stock on December 16, 2024. This move, reflecting confidence in future growth, aims to enhance liquidity and respond to market opportunities amid volatile coal markets. The stock dividend will increase the Class B public float by approximately 9%, based on share prices as of November 19, 2024.

Ramaco Resources Achieves Record Production Amid Market Challenges

Ramaco Resources reported strong operational performance in the third quarter of 2024, despite a challenging market environment marked by declining metallurgical coal prices. The company achieved record production and sales levels, while reducing cash costs significantly, bolstered by increased productivity and operational efficiency. Although financial results were impacted by a drop in coal indices, Ramaco maintained healthy cash margins. Looking ahead, the company anticipates further improvements in production and sales, aiming for a robust year-end performance.