NYSE:ARCH

Stock Analysis Report

Executive Summary

Arch Coal, Inc. produces and sells thermal and metallurgical coal from surface and underground mines.

Snowflake

Fundamentals

Proven track record with adequate balance sheet.


Similar Companies

Share Price & News

How has Arch Coal's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-0.1%

ARCH

-1.7%

US Oil and Gas

0.5%

US Market


1 Year Return

-17.4%

ARCH

-21.6%

US Oil and Gas

6.8%

US Market

Return vs Industry: ARCH exceeded the US Oil and Gas industry which returned -21.6% over the past year.

Return vs Market: ARCH underperformed the US Market which returned 6.8% over the past year.


Shareholder returns

ARCHIndustryMarket
7 Day-0.1%-1.7%0.5%
30 Day9.7%-6.4%-0.8%
90 Day-13.4%-9.4%-0.9%
1 Year-15.6%-17.4%-18.7%-21.6%9.2%6.8%
3 Year9.5%4.3%-8.2%-16.4%45.6%36.2%
5 Yearn/a-24.8%-35.2%63.2%45.4%

Price Volatility Vs. Market

How volatile is Arch Coal's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Arch Coal undervalued compared to its fair value and its price relative to the market?

4.1x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ARCH ($78.93) is trading above our estimate of fair value ($75.52)

Significantly Below Fair Value: ARCH is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ARCH is good value based on its PE Ratio (4.1x) compared to the Oil and Gas industry average (9.8x).

PE vs Market: ARCH is good value based on its PE Ratio (4.1x) compared to the US market (17.7x).


Price to Earnings Growth Ratio

PEG Ratio: ARCH's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: ARCH is overvalued based on its PB Ratio (1.8x) compared to the US Oil and Gas industry average (0.9x).


Next Steps

Future Growth

How is Arch Coal forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

-21.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ARCH's earnings are forecast to decline over the next 3 years (-21.9% per year).

Earnings vs Market: ARCH's earnings are forecast to decline over the next 3 years (-21.9% per year).

High Growth Earnings: ARCH's earnings are forecast to decline over the next 3 years.

Revenue vs Market: ARCH's revenue is expected to decline over the next 3 years (-1.1% per year).

High Growth Revenue: ARCH's revenue is forecast to decline over the next 3 years (-1.1% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ARCH's Return on Equity is forecast to be high in 3 years time (21.3%)


Next Steps

Past Performance

How has Arch Coal performed over the past 5 years?

48.0%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: ARCH has become profitable over the past 5 years, growing earnings by 48% per year.

Accelerating Growth: ARCH's earnings growth over the past year (36.4%) is below its 5-year average (48% per year).

Earnings vs Industry: ARCH earnings growth over the past year (36.4%) exceeded the Oil and Gas industry 22.6%.


Return on Equity

High ROE: ARCH's Return on Equity (49.4%) is considered outstanding.


Return on Assets

ROA vs Industry: ARCH has a higher Return on Assets than the Oil and Gas industry average last year.


Return on Capital Employed

ROCE Improving: ARCH's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Arch Coal's financial position?


Financial Position Analysis

Short Term Liabilities: ARCH's short term assets ($840.7M) exceeds its short term liabilities ($314.5M)

Long Term Liabilities: ARCH's short term assets (840.7M) do not cover its long term liabilities (877.0M)


Debt to Equity History and Analysis

Debt Level: ARCH's debt to equity ratio (44.5%) is considered high

Reducing Debt: ARCH's debt to equity ratio has reduced from 253.3% to 44.5% over the past 5 years.

Debt Coverage: ARCH's debt is well covered by operating cash flow (160.4%).

Interest Coverage: ARCH's interest payments on its debt are well covered by EBIT (28.8x coverage).


Balance Sheet

Inventory Level: ARCH has a high level of physical assets or inventory.

Debt Coverage by Assets: ARCH's debt is covered by short term assets (assets are 2.703790x debt).


Next Steps

Dividend

What is Arch Coal's current dividend yield, its reliability and sustainability?

2.28%

Current Dividend Yield


Dividend Yield vs Market

company2.3%marketbottom25%1.4%markettop25%3.7%industryaverage4.2%forecastin3Years2.3%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: ARCH's dividend (2.28%) is higher than the bottom 25% of dividend payers in the US market (1.45%).

High Dividend: ARCH's dividend (2.28%) is low compared to the top 25% of dividend payers in the US market (3.73%).

Stable Dividend: Whilst dividend payments have been stable, ARCH has been paying a dividend for less than 10 years.

Growing Dividend: ARCH's dividend payments have increased, but the company has only paid a dividend for 2 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (8.8%), ARCH's dividend payments are thoroughly covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: ARCH's dividends in 3 years are forecast to be thoroughly covered by earnings (11.3% payout ratio).


Next Steps

Management

What is the CEO of Arch Coal's salary, the management and board of directors tenure and is there insider trading?

7.7yrs

Average management tenure


CEO

John Eaves (61yo)

7.5yrs

Tenure

US$9,227,715

Compensation

Mr. John W. Eaves, also known as Jo, has been Chief Executive Officer of Arch Coal, Inc. since April 26, 2012. Mr. Eaves served as President of Arch Coal, Inc since April 28, 2006 until April 23, 2015. He  ...


CEO Compensation Analysis

Compensation vs. Market: John's total compensation ($USD9.23M) is about average for companies of similar size in the US market ($USD4.00M).

Compensation vs Earnings: John's compensation has been consistent with company performance over the past year.


Management Age and Tenure

7.7yrs

Average Tenure

57yo

Average Age

Experienced Management: ARCH's management team is seasoned and experienced (7.7 years average tenure).


Board Age and Tenure

3.0yrs

Average Tenure

57yo

Average Age

Experienced Board: ARCH's board of directors are considered experienced (3 years average tenure).


Insider Trading

Insider Buying: ARCH insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$12,460,71013 Sep 19
Monarch Alternative Capital LP
EntityCompany
Shares150,550
Max PriceUS$82.84
BuyUS$98,97008 Aug 19
Robert Hamill
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,000
Max PriceUS$98.97
BuyUS$78,72002 Aug 19
James Chapman
EntityIndividual
Role
Chairman of the Board
Chairman
Shares1,000
Max PriceUS$78.72
BuyUS$78,40002 Aug 19
Robert Hamill
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,000
Max PriceUS$78.40
BuyUS$195,84401 Aug 19
Holly Koeppel
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,200
Max PriceUS$89.02
SellUS$23,490,89018 Mar 19
Monarch Alternative Capital LP
EntityCompany
Shares253,380
Max PriceUS$93.63

Ownership Breakdown


Management Team

  • John Eaves (61yo)

    CEO & Director

    • Tenure: 7.5yrs
    • Compensation: US$9.23m
  • Bob Jones (62yo)

    Senior VP of Law

    • Tenure: 19.6yrs
    • Compensation: US$2.46m
  • John Lorson

    VP & Chief Accounting Officer

    • Tenure: 0yrs
  • Deck Slone (55yo)

    Senior Vice President of Strategy & Public Policy

    • Tenure: 11.2yrs
  • Paul Lang (58yo)

    President & COO

    • Tenure: 4.5yrs
    • Compensation: US$5.68m
  • Paul Demzik (57yo)

    Senior VP & Chief Commercial Officer

    • Tenure: 0.8yrs
  • John Ziegler (52yo)

    Senior VP & Chief Administrative Officer

    • Tenure: 0.8yrs
    • Compensation: US$2.03m
  • John Drexler (49yo)

    CFO & Senior VP

    • Tenure: 11.5yrs
    • Compensation: US$4.19m
  • Greg Szczepan

    Controller & Director of External Financial Reporting

    • Tenure: 11.5yrs
  • Matt Ferguson

    Senior Vice President of Metallurgical & International Thermal Coal - Arch Coal Sales

    • Tenure: 7.7yrs

Board Members

  • John Eaves (61yo)

    CEO & Director

    • Tenure: 7.5yrs
    • Compensation: US$9.23m
  • Rick Navarre (58yo)

    Director

    • Tenure: 3yrs
    • Compensation: US$243.33k
  • Holly Koeppel (60yo)

    Director

    • Tenure: 0.7yrs
  • Jim Chapman (57yo)

    Chairman

    • Tenure: 3yrs
    • Compensation: US$340.00k
  • Patrick Bartels (44yo)

    Director

    • Tenure: 3yrs
    • Compensation: US$245.00k
  • Patrick Kriegshauser (57yo)

    Director

    • Tenure: 3yrs
    • Compensation: US$250.00k
  • Sherman Edmiston (57yo)

    Director

    • Tenure: 3yrs
    • Compensation: US$240.00k
  • Bob Hamill (56yo)

    Director

    • Tenure: 0.7yrs

Company Information

Arch Coal, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Arch Coal, Inc.
  • Ticker: ARCH
  • Exchange: NYSE
  • Founded: 1969
  • Industry: Coal and Consumable Fuels
  • Sector: Energy
  • Market Cap: US$1.284b
  • Shares outstanding: 16.26m
  • Website: https://www.archcoal.com

Number of Employees


Location

  • Arch Coal, Inc.
  • One CityPlace Drive
  • Suite 300
  • St. Louis
  • Missouri
  • 63141
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ACCADB (Deutsche Boerse AG)YesClass A Common StockDEEUROct 2016
ARCHNYSE (New York Stock Exchange)YesClass A Common StockUSUSDOct 2016

Biography

Arch Coal, Inc. produces and sells thermal and metallurgical coal from surface and underground mines. As of December 31, 2018, the company operated nine active mines. It also owned or controlled primarily  ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/22 00:33
End of Day Share Price2019/10/21 00:00
Earnings2019/06/30
Annual Earnings2018/12/31


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.