| Snowflake Score | |
|---|---|
| Valuation | 5/6 |
| Future Growth | 0/6 |
| Past Performance | 2/6 |
| Financial Health | 5/6 |
| Dividends | 4/6 |
ARLP Stock Overview
Alliance Resource Partners, L.P., a diversified natural resource company, produces and markets coal primarily to utilities and industrial users in the United States.
Alliance Resource Partners Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$13.54 |
| 52 Week High | US$15.03 |
| 52 Week Low | US$4.98 |
| Beta | 1.81 |
| 1 Month Change | 12.83% |
| 3 Month Change | 16.42% |
| 1 Year Change | 158.89% |
| 3 Year Change | -27.94% |
| 5 Year Change | -44.39% |
| Change since IPO | 187.89% |
Recent News & Updates
Alliance Resource Partners: Expect Higher Distributions In 2022 But Watch Out For 2023
After reinstating their distributions early in 2021, Alliance Resource Partners has now doubled them following a strong third quarter. This has been supported by their surging free cash flow and when looking ahead, they could afford to double their distributions once again providing these favorable operating conditions continue unabated. This has also sent their net debt plunging towards zero by approximately the middle of 2022. This makes it reasonable to expect higher distributions in 2022 given the lack of competing uses for their ample free cash flow. Despite being positive, it would be best to watch out for 2023 and beyond with management voicing concerns over coal power plants closures and thus I still believe that only a neutral rating is appropriate.
Alliance Resource Partners: A Higher Yield Is Inbound, Could Be 10%+
After only reinstating their distributions one quarter ago, Alliance Resource Partners is already talking of taking a relook with an eye towards further increases. Their free cash flow has surged during the second quarter of 2021, which provides a very solid base for higher distributions. Even without further operating condition improvements, they could still conservatively offer a 10%+ distribution yield on current cost. They have now reached their leverage target and when combined with their strong liquidity, they have no financial handbrake stopping higher distributions. Whilst this makes it appear that a higher yield is inbound, the long-term questions over their future coal-reliant earnings remain, and thus I only believe that a neutral rating is appropriate.
Shareholder Returns
| ARLP | US Oil and Gas | US Market | |
|---|---|---|---|
| 7D | -7.7% | -3.9% | -6.1% |
| 1Y | 158.9% | 46.2% | 4.2% |
Return vs Industry: ARLP exceeded the US Oil and Gas industry which returned 48.8% over the past year.
Return vs Market: ARLP exceeded the US Market which returned 6.6% over the past year.
Price Volatility
| ARLP volatility | |
|---|---|
| ARLP Average Weekly Movement | 5.8% |
| Oil and Gas Industry Average Movement | 7.2% |
| Market Average Movement | 6.7% |
| 10% most volatile stocks in US Market | 15.6% |
| 10% least volatile stocks in US Market | 2.4% |
Stable Share Price: ARLP is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.
Volatility Over Time: ARLP's weekly volatility (6%) has been stable over the past year.
About the Company
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1971 | 2,902 | Joe Craft | https://www.arlp.com |
Alliance Resource Partners, L.P., a diversified natural resource company, produces and markets coal primarily to utilities and industrial users in the United States. The company operates through three segments: Illinois Basin, Appalachia, and Minerals. It produces a range of thermal and metallurgical coal with sulfur and heat contents.
Alliance Resource Partners Fundamentals Summary
| ARLP fundamental statistics | |
|---|---|
| Market Cap | US$1.72b |
| Earnings (TTM) | US$158.14m |
| Revenue (TTM) | US$1.46b |
10.9x
P/E Ratio1.2x
P/S RatioIs ARLP overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| ARLP income statement (TTM) | |
|---|---|
| Revenue | US$1.46b |
| Cost of Revenue | US$920.62m |
| Gross Profit | US$542.40m |
| Expenses | US$384.25m |
| Earnings | US$158.14m |
Last Reported Earnings
Sep 30, 2021
Next Earnings Date
Jan 31, 2022
| Earnings per share (EPS) | 1.24 |
| Gross Margin | 37.07% |
| Net Profit Margin | 10.81% |
| Debt/Equity Ratio | 37.4% |
How did ARLP perform over the long term?
See historical performance and comparisonDividends
5.9%
Current Dividend Yield32%
Payout RatioValuation
Is Alliance Resource Partners undervalued compared to its fair value and its price relative to the market?
48.5%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: ARLP ($13.54) is trading below our estimate of fair value ($26.31)
Significantly Below Fair Value: ARLP is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: ARLP is good value based on its PE Ratio (10.9x) compared to the US Oil and Gas industry average (17.9x).
PE vs Market: ARLP is good value based on its PE Ratio (10.9x) compared to the US market (16.7x).
Price to Earnings Growth Ratio
PEG Ratio: Insufficient data to calculate ARLP's PEG Ratio to determine if it is good value.
Price to Book Ratio
PB vs Industry: ARLP is good value based on its PB Ratio (1.5x) compared to the US Oil and Gas industry average (2.2x).
Future Growth
How is Alliance Resource Partners forecast to perform in the next 1 to 3 years based on estimates from 1 analyst?
2.0%
Forecasted annual revenue growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: Insufficient data to determine if ARLP's forecast earnings growth is above the savings rate (2%).
Earnings vs Market: Insufficient data to determine if ARLP's earnings are forecast to grow faster than the US market
High Growth Earnings: Insufficient data to determine if earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: ARLP's revenue (2% per year) is forecast to grow slower than the US market (9.2% per year).
High Growth Revenue: ARLP's revenue (2% per year) is forecast to grow slower than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: Insufficient data to determine if ARLP's Return on Equity is forecast to be high in 3 years time
Past Performance
How has Alliance Resource Partners performed over the past 5 years?
-23.8%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: ARLP has high quality earnings.
Growing Profit Margin: ARLP became profitable in the past.
Past Earnings Growth Analysis
Earnings Trend: ARLP's earnings have declined by 23.8% per year over the past 5 years.
Accelerating Growth: ARLP has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.
Earnings vs Industry: ARLP has become profitable in the last year, making it difficult to compare its past year earnings growth to the Oil and Gas industry (17.4%).
Return on Equity
High ROE: ARLP's Return on Equity (13.7%) is considered low.
Financial Health
How is Alliance Resource Partners's financial position?
Financial Position Analysis
Short Term Liabilities: ARLP's short term assets ($326.2M) exceed its short term liabilities ($191.1M).
Long Term Liabilities: ARLP's short term assets ($326.2M) do not cover its long term liabilities ($776.1M).
Debt to Equity History and Analysis
Debt Level: ARLP's net debt to equity ratio (28.5%) is considered satisfactory.
Reducing Debt: ARLP's debt to equity ratio has reduced from 63.6% to 37.4% over the past 5 years.
Debt Coverage: ARLP's debt is well covered by operating cash flow (95%).
Interest Coverage: ARLP's interest payments on its debt are well covered by EBIT (4.9x coverage).
Balance Sheet
Dividend
What is Alliance Resource Partners's current dividend yield, its reliability and sustainability?
5.91%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: ARLP's dividend (5.91%) is higher than the bottom 25% of dividend payers in the US market (1.36%).
High Dividend: ARLP's dividend (5.91%) is in the top 25% of dividend payers in the US market (3.55%)
Stability and Growth of Payments
Stable Dividend: ARLP's dividend payments have been volatile in the past 10 years.
Growing Dividend: ARLP's dividend payments have fallen over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonably low payout ratio (32.2%), ARLP's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: ARLP's dividends in 3 years are forecast to be well covered by earnings (41.3% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
13.9yrs
Average management tenure
CEO
Joe Craft (70 yo)
22.42yrs
Tenure
US$1
Compensation
Mr. Joseph W. Craft, III, also known as Joe has the been the President and Chief Executive Officer of Alliance Resource Management GP LLC, Managing General Partner at Alliance Resource Partners L.P. since...
CEO Compensation Analysis
Compensation vs Market: Joe's total compensation ($USD1.00) is below average for companies of similar size in the US market ($USD3.73M).
Compensation vs Earnings: Joe's compensation has been consistent with company performance over the past year.
Leadership Team
Experienced Management: ARLP's management team is seasoned and experienced (13.9 years average tenure).
Board Members
Experienced Board: ARLP's board of directors are seasoned and experienced ( 10.9 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: ARLP insiders have only sold shares in the past 3 months.
Recent Insider Transactions
Ownership Breakdown
Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.
Top Shareholders
Company Information
Alliance Resource Partners, L.P.'s employee growth, exchange listings and data sources
Key Information
- Name: Alliance Resource Partners, L.P.
- Ticker: ARLP
- Exchange: NasdaqGS
- Founded: 1971
- Industry: Coal and Consumable Fuels
- Sector: Energy
- Implied Market Cap: US$1.722b
- Shares outstanding: 127.20m
- Website: https://www.arlp.com
Number of Employees
Location
- Alliance Resource Partners, L.P.
- 1717 South Boulder Avenue
- Suite 400
- Tulsa
- Oklahoma
- 74119
- United States
Listings
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2022/01/21 23:39 |
| End of Day Share Price | 2022/01/21 00:00 |
| Earnings | 2021/09/30 |
| Annual Earnings | 2020/12/31 |
Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.