Alpha Appalachia Holdings (NYSE: MEE) and Natural Resource Partners (NYSE:NRP) are both coal – nec companies, but which is the superior business? We will contrast the two companies based on the strength of their earnings, profitability, valuation, institutional ownership, analyst recommendations, risk and dividends.

Dividends

Natural Resource Partners pays an annual dividend of $1.80 per share and has a dividend yield of 6.9%. Alpha Appalachia Holdings does not pay a dividend. Natural Resource Partners pays out 72.0% of its earnings in the form of a dividend.

Insider and Institutional Ownership

20.3% of Natural Resource Partners shares are held by institutional investors. 39.0% of Natural Resource Partners shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares Alpha Appalachia Holdings and Natural Resource Partners’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Alpha Appalachia Holdings N/A N/A N/A ($2.05) N/A
Natural Resource Partners $400.06 million 0.79 $96.89 million $2.50 10.38

Natural Resource Partners has higher revenue and earnings than Alpha Appalachia Holdings. Alpha Appalachia Holdings is trading at a lower price-to-earnings ratio than Natural Resource Partners, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Alpha Appalachia Holdings and Natural Resource Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alpha Appalachia Holdings N/A N/A N/A
Natural Resource Partners 26.38% 34.32% 4.38%

Analyst Recommendations

This is a summary of current recommendations and price targets for Alpha Appalachia Holdings and Natural Resource Partners, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alpha Appalachia Holdings 0 0 0 0 N/A
Natural Resource Partners 0 1 0 0 2.00

Natural Resource Partners has a consensus price target of $31.00, indicating a potential upside of 19.46%.

Summary

Natural Resource Partners beats Alpha Appalachia Holdings on 8 of the 9 factors compared between the two stocks.

About Alpha Appalachia Holdings

Massey Energy Company (Massey) is a coal producer in the United States. The Company produces, processes and sells bituminous coal of various steam and metallurgical grades, primarily of a low sulfur content, through its 25 processing and shipping centers (Resource Groups), many of which receive coal from multiple mines. At January 31, 2011, the Company operated 84 mines, including 66 underground mines (one of which employs both room and pillar and longwall mining) and 18 surface mines (with 12 highwall miners in operation) in West Virginia, Kentucky and Virginia. On April 19, 2010, the Company completed the acquisition of Cumberland Resources Corporation and certain affiliated entities (Cumberland). The Cumberland operations include primarily underground coal mines in Southwestern Virginia and Eastern Kentucky. The Company owns a majority interest in Coalsolv, LLC (Coalsolv).

About Natural Resource Partners

Natural Resource Partners L.P. owns, operates, manages and leases a portfolio of mineral properties in the United States, including interests in coal, trona and soda ash, construction aggregates and other natural resources. Coal Royalty and Other segment consists primarily of coal royalty and coal related transportation and processing assets. As of December 31, 2016, Soda Ash segment included the Company’s 49% non-controlling equity interest in Ciner Wyoming, a trona ore mining operation and soda ash refinery in the Green River Basin, Wyoming. VantaCore’s operating businesses include Laurel Aggregates, located in Lake Lynn, Pennsylvania; Winn Materials/McIntosh Construction, located in Clarksville, Tennessee; Grand Rivers, located in Grand Rivers, Kentucky, and Southern Aggregates, located near Baton Rouge, Louisiana.

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