American Resources (AREC) AI Stock Analysis

• Market Cap: $302.15M
• Dividend Yield: N/A
• Average Volume (3M): 4.45M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.16
• Revenue Growth: -76.24%
• EPS Growth: -8.61%
• Country: US
• Employees: 26
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Coal
• EPS (TTM): N/A
• Shares Outstanding: 101,393,310
• 10 Day Avg. Volume: 2,957,944
• 30 Day Avg. Volume: 4,452,333
• PEG Ratio: >-0.01
• Price to Book (P/B): -0.97
• Price to Sales (P/S): 203.52
• P/FCF Ratio: -3.35
• Enterprise Value/Market Cap: 1.77
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $6.00
• Price Target Upside: 101.34% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 53 Neutral
• Price Target: $3.00 ▲(0.67% Upside)

The score is held back primarily by weak financial performance (sharp revenue decline, large losses, negative equity with high debt, and ongoing cash burn). Technicals are a notable offset with the stock trading above key moving averages and positive MACD, while valuation remains neutral-to-weak given the negative P/E and no dividend.

Positive Factors

Scale funding for critical-mineral refining

A $200M strategic equity facility materially de-risks capital intensity for ReElement’s buildout. It enables the Marion plant to scale toward >10,000 tpa capacity, supports multi-site rollouts, and provides durable funding to commercialize processing technology and capture domestic demand over years.

Advanced refining capability

Demonstrated ability to produce >99.9% samarium shows differentiated processing expertise and product quality needed by defense and industrial magnet makers. Technical leadership supports long-term customer qualification, higher-margin product niches, and reduced reliance on volatile ore markets.

Blockchain-backed traceability & partnerships

Blockchain tokenization and a strategic equity stake in SAGINT create immutable provenance and DFARS-ready traceability for refined minerals. This structural capability strengthens defense/industrial customer stickiness, simplifies compliance audits, and can enable secure trade finance and premium contract access.

Negative Factors

Severe revenue decline

A roughly 56% drop in trailing revenue erodes scale and operating leverage, making fixed-cost coverage and margin recovery difficult. Persistently depressed top-line undermines the company’s ability to fund operations internally and maintain long-term customer and supplier relationships without external support.

Highly leveraged balance sheet

Negative shareholders’ equity and material debt create solvency and refinancing risk, limiting strategic flexibility. High leverage increases probability of dilution or onerous financing terms, constraining the company’s ability to invest in capacity expansion or weather cyclical downturns in commodity markets.

Persistent cash burn

Sustained negative operating and free cash flow forces reliance on external financing to fund growth and working capital. That dependence raises execution risk for multi-year capital projects and heightens vulnerability to tightening credit conditions, which could delay commercialization or require dilutive capital raises.

American Resources Business Overview & Revenue Model

Company Description

American Resources Corporation engages in the extraction, processing, transportation, distribution, and sale of metallurgical coal to the steel industries. The company supplies raw materials; and sells coal used in pulverized coal injections. It has a portfolio of operations located in the Pike, Knott, and Letcher Counties in Kentucky; and Wyoming County, West Virginia. American Resources Corporation was founded in 2006 and is headquartered in Fishers, Indiana.

How the Company Makes Money

American Resources generates revenue primarily through the sale of metallurgical coal to steel producers and other industrial customers. The company has established key revenue streams from its coal mining operations, which involve extracting, processing, and selling coal products. Additionally, AREC is involved in the recovery of critical minerals, which has the potential to diversify its revenue base. The company benefits from strategic partnerships with various industrial clients and has positioned itself to capitalize on the growing demand for metallurgical coal in global markets, particularly as economies recover and expand. Factors contributing to its earnings include operational efficiencies, market pricing for coal, and the ability to adapt to regulatory changes in the energy sector.

American Resources Financial Statement Overview

Summary

Financials indicate a stressed profile: TTM revenue is down ~56%, profitability is deeply negative with very large losses, equity is negative (~-$93M) against substantial debt (~$234M), and both operating cash flow (~-$15M) and free cash flow (~-$7M) are negative—pointing to high financial risk and reliance on external funding.

Income Statement

TTM (Trailing-Twelve-Months) performance shows severe deterioration, with revenue down ~56% versus the prior period and extremely large operating losses. While the TTM gross margin is unusually high, profitability remains deeply negative with a very large net loss, indicating that operating costs and other expenses are overwhelming the business. Longer-term results are volatile (including periods of negative gross profit), but the consistent pattern is sustained losses and weak earnings quality.

Balance Sheet

Leverage risk is very high: total debt is substantial (~$234M TTM) while shareholders’ equity is negative (about -$93M TTM), a major financial stability red flag that limits flexibility and raises refinancing/solvency risk. Total assets (~$201M TTM) are below total debt, reinforcing balance-sheet strain. The reported return on equity is not very informative given negative equity, so the key takeaway is a thin/negative capital base supporting a highly levered structure.

Cash Flow

Cash generation is weak and consistently pressured: TTM operating cash flow is negative (~-$15M) and free cash flow is also negative (~-$7M), indicating the business is not self-funding. Cash flow deficits have persisted across multiple years (with only a brief positive year in 2022), increasing dependence on external financing. While free cash flow is less negative than net income in TTM (losses include non-cash items), the ongoing cash burn remains a material risk.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	145.03K	383.23K	13.23M	39.47M	7.76M	1.06M
Gross Profit	140.16K	-2.18M	1.25M	14.00M	-639.79K	-4.05M
EBITDA	-22.47M	-27.07M	-33.19M	3.51M	-24.01M	-2.02M
Net Income	-39.90M	-40.11M	-38.53M	-1.45M	-32.50M	-10.26M
Balance Sheet
Total Assets	―	205.01M	64.73M	55.92M	42.87M	38.42M
Cash, Cash Equivalents and Short-Term Investments	―	1.19M	2.67M	10.87M	11.49M	10.62M
Total Debt	―	220.51M	47.10M	23.49M	15.72M	30.70M
Total Liabilities	―	286.92M	109.73M	55.63M	45.22M	58.42M
Stockholders Equity	―	-80.35M	-43.53M	284.70K	-2.35M	-20.01M
Cash Flow
Free Cash Flow	-6.97M	-23.28M	-23.72M	2.55M	-32.16M	-13.85M
Operating Cash Flow	-15.33M	-22.23M	-20.10M	2.55M	-29.09M	-13.85M
Investing Cash Flow	1.09M	55.98K	-5.63M	-1.13M	-5.92M	417.86K
Financing Cash Flow	10.54M	146.66M	45.61M	-1.02M	36.40M	24.36M

American Resources Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.98
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AREC, the sentiment is Negative. The current price of 2.98 is below the 20-day moving average (MA) of 3.61, below the 50-day MA of 3.05, and above the 200-day MA of 2.23, indicating a neutral trend. The MACD of 0.06 indicates Positive momentum. The RSI at 44.19 is Neutral, neither overbought nor oversold. The STOCH value of 11.81 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AREC.

American Resources Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SXC	69 Neutral	$695.95M	10.65	9.61%	6.72%	-6.44%	-24.68%
NRP	67 Neutral	$1.55B	10.83	26.19%	4.05%	-14.79%	-17.10%
NC	67 Neutral	$409.94M	14.19	7.04%	2.02%	25.35%	―
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
HNRG	57 Neutral	$828.60M	-4.34	-74.70%	―	7.60%	-591.73%
AMR	54 Neutral	$2.68B	-58.50	-2.87%	―	-32.53%	-112.77%
AREC	53 Neutral	$302.15M	-6.42	―	―	-76.24%	-8.61%