Warrior Met Coal (HCC) versus CONSOL Coal Resources (CCR) Critical Analysis

Warrior Met Coal (NYSE: HCC) and CONSOL Coal Resources (NYSE:CCR) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their dividends, analyst recommendations, profitability, valuation, risk, institutional ownership and earnings.

Earnings and Valuation

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This table compares Warrior Met Coal and CONSOL Coal Resources’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Warrior Met Coal $1.17 billion 1.08 $455.04 million $7.89 3.01
CONSOL Coal Resources $322.78 million 1.26 $40.46 million $1.46 10.10

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

Analyst Recommendations

This is a summary of recent recommendations and price targets for Warrior Met Coal and CONSOL Coal Resources, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Warrior Met Coal 0 6 5 0 2.45
CONSOL Coal Resources 0 1 5 0 2.83

Warrior Met Coal presently has a consensus price target of $28.55, indicating a potential upside of 20.19%. CONSOL Coal Resources has a consensus price target of $20.40, indicating a potential upside of 38.31%. Given CONSOL Coal Resources’ stronger consensus rating and higher probable upside, analysts clearly believe CONSOL Coal Resources is more favorable than Warrior Met Coal.

Insider & Institutional Ownership

24.1% of CONSOL Coal Resources shares are held by institutional investors. 0.5% of Warrior Met Coal shares are held by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Dividends

Warrior Met Coal pays an annual dividend of $0.20 per share and has a dividend yield of 0.8%. CONSOL Coal Resources pays an annual dividend of $2.05 per share and has a dividend yield of 13.9%. Warrior Met Coal pays out 2.5% of its earnings in the form of a dividend. CONSOL Coal Resources pays out 140.4% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Warrior Met Coal has raised its dividend for 11 consecutive years.

Profitability

This table compares Warrior Met Coal and CONSOL Coal Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Warrior Met Coal 38.92% 61.78% 43.24%
CONSOL Coal Resources 10.56% 21.19% 7.28%

Summary

Warrior Met Coal beats CONSOL Coal Resources on 9 of the 15 factors compared between the two stocks.

About Warrior Met Coal

Warrior Met Coal, Inc., formerly Warrior Met Coal, LLC, is a producer and exporter of metallurgical coal for the steel industry from underground mines located in Brookwood, Alabama, southwest of Birmingham and near Tuscaloosa. These underground coalmines are 1,400 to 2,100 feet underground. Its operations serve markets in the United States, Europe, Asia and South America via barge and rail access to the Port of Mobile. Currently it has the operational capacity to mine eight million tons of coal per year from more than 300 million tons of recoverable reserves. Its operations also extract methane gas from the Blue Creek coal seam. Its gas division represents commercial programs for coal seam degasification in the country, producing approximately 30 million cubic feet of gas daily from over 1750 gas wells. Its mines operate under permits issued by the Alabama Surface Mining Commission (ASMC), the Alabama Department of Environmental Management (ADEM) and other state and federal agencies.

About CONSOL Coal Resources

CONSOL Coal Resources LP produces and sells high-Btu thermal coal in the Northern Appalachian Basin and the eastern United States. It owns a 25% undivided interest in the Pennsylvania mining complex, which consists of three underground mines and related infrastructure that produce high-Btu bituminous thermal coal located primarily in southwestern Pennsylvania. The company markets its thermal coal principally to electric utilities in the eastern United States. CONSOL Coal Resources GP LLC operates as a general partner of the company. The company was formerly known as CNX Coal Resources LP and changed its name to CONSOL Coal Resources LP in November 2017. CONSOL Coal Resources LP was founded in 2015 and is headquartered in Canonsburg, Pennsylvania. CONSOL Coal Resources LP is a subsidiary of CONSOL Energy Inc.

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