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Alliance Resource Partners (ARLP)
NASDAQ:ARLP
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Alliance Resource
(NASDAQ:ARLP)
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Rating:72Outperform
Price Target:
$27.00
▲(10.52% Upside)
Alliance Resource's overall stock score is driven by its strong financial performance and attractive valuation, despite mixed technical indicators and earnings call results. The company's robust profitability, solid balance sheet, and high dividend yield are significant strengths, while the neutral technical outlook and mixed earnings call results present moderate risks.
Positive Factors
Strong Cash Flow Generation
Robust free cash flow generation indicates strong operational efficiency and provides the company with flexibility for future investments and debt reduction.
Operational Efficiency
Improved EBITDA reflects effective cost management and operational efficiency, enhancing the company's profitability and competitive position.
Strong Balance Sheet
A strong balance sheet with low leverage provides financial stability and the ability to withstand market fluctuations, supporting long-term growth.
Negative Factors
Revenue Decline
A decline in revenue indicates challenges in maintaining sales momentum, which could impact future profitability and market share.
Decline in Coal Sales Price
Falling coal prices can pressure margins and reduce revenue, affecting the company's ability to invest in growth opportunities.
Appalachia Sales Volume Decline
Decreased sales volumes in Appalachia suggest operational challenges or reduced demand, potentially impacting regional market presence.
Alliance Resource (ARLP) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$3.14B
Dividend Yield11.05%
Average Volume (3M)335.99K
Price to Earnings (P/E)12.9
Beta (1Y)0.42
Revenue Growth-9.45%
EPS Growth-46.37%
CountryUS
Employees3,653
SectorEnergy
Sector Strength52
IndustryCoal
Share Statistics
EPS (TTM)0.73
Shares Outstanding128,428,020
10 Day Avg. Volume293,944
30 Day Avg. Volume335,986
Financial Highlights & Ratios
PEG Ratio-0.22
Price to Book (P/B)1.84
Price to Sales (P/S)1.37
P/FCF Ratio8.99
Enterprise Value/Market Cap1.11
Enterprise Value/Revenue1.55
Enterprise Value/Gross Profit8.43
Enterprise Value/Ebitda5.72
Forecast
1Y Price Target
$33.00Price Target Upside35.08% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering1
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Alliance Resource Business Overview & Revenue Model
Company DescriptionAlliance 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 four segments: Illinois Basin Coal Operations, Appalachia Coal Operations, Oil & Gas Royalties, and Coal Royalties. It produces a range of thermal and metallurgical coal with sulfur and heat contents. The company operates seven underground mining complexes in Illinois, Indiana, Kentucky, Maryland, Pennsylvania, and West Virginia. In addition, it leases land and operates a coal loading terminal on the Ohio River at Mt. Vernon, Indiana; and buys and resells coal, as well as owns mineral and royalty interests in approximately 1.5 million gross acres of oil and gas producing regions primarily in the Permian, Anadarko, and Williston Basins. Further, the company offers various mining technology products and services, including data network, communication and tracking systems, mining proximity detection systems, industrial collision avoidance systems, and data and analytics software. As of December 31, 2021, it had approximately 547.1 million tons of proven and probable coal mineral reserves, as well as 1.17 billion tons of measured, indicated, and inferred coal mineral resources in Illinois, Indiana, Kentucky, Maryland, Pennsylvania, and West Virginia. The company was founded in 1971 and is headquartered in Tulsa, Oklahoma.
How the Company Makes MoneyAlliance Resource generates revenue primarily through the sale of coal, which is its core product. The company operates several mining complexes, producing millions of tons of coal annually, which it sells to a variety of customers in both domestic and international markets. Key revenue streams include long-term contracts with major utility companies, spot market sales, and export sales. Additionally, ARLP benefits from price fluctuations in the coal market, allowing it to capitalize on higher prices during periods of increased demand. The company may also engage in partnerships or joint ventures to enhance its operational efficiency and expand its market reach, further contributing to its earnings.
Alliance Resource Earnings Call Summary
Earnings Call Date:Oct 27, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 02, 2026
Earnings Call Sentiment Neutral
The earnings call reflects a mixed performance, with strong operational improvements and increased volumes contrasting with decreased revenue and sales prices. Despite challenges, strategic investments and operational efficiencies have positioned the company for potential growth.Q3-2025 Updates
Positive Updates
Increased Coal Sales Volumes
Total coal sales volumes increased 3.9% to 8.7 million tons compared to the same quarter last year, and increased 3.8% compared to the previous quarter.
Strong Performance in Illinois Basin
Coal sales volumes in the Illinois Basin increased by 10.8% compared to the same quarter last year.
Improved EBITDA
Adjusted EBITDA for the quarter was $185.8 million, up 9% from the same quarter last year and up 14.8% sequentially.
Positive Free Cash Flow
Alliance generated free cash flow of $151.4 million after investing $63.8 million in coal operations.
Royalty Segment Revenue Growth
Total revenues in the royalty segment were $57.4 million, up 11.9% compared to the same quarter last year.
Successful Transition in Appalachia
Appalachia operations improved with a 21.8% increase in coal sales volumes compared to the previous quarter due to a successful transition to a new longwall district at Tunnel Ridge.
Negative Updates
Decrease in Total Revenue
Total revenues for the quarter were $571.4 million, down from $613.6 million in the same quarter last year.
Decline in Coal Sales Price
Average coal sales price per ton was $58.78, a decrease of 7.5% compared to the same quarter last year.
Appalachia Coal Sales Volume Decline
Coal sales volumes in Appalachia were down 13.3% compared to the same quarter last year due to lower production at Tunnel Ridge.
Lower Oil and Gas Sales Prices
There was a 10.5% decline in average oil and gas sales price per BOE compared to the same quarter last year.
Contingent Consideration Liability
Expenses included a $4.4 million unfavorable contingent consideration liability adjustment at Hamilton mine.
Company Guidance
During the third quarter of 2025, Alliance Resource Partners reported total revenues of $571.4 million, a decrease from $613.6 million in the same quarter of 2024, primarily due to lower coal sales prices and transportation revenues, despite an increase in coal sales volumes. Average coal sales price per ton was $58.78, down 7.5% year-over-year but up 1.5% sequentially. Coal production and sales volumes saw notable increases, with production at 8.4 million tons (up 8.5% year-over-year) and sales at 8.7 million tons (up 3.9% year-over-year). The company's royalty segment reported revenues of $57.4 million, an 11.9% increase from the previous year, driven by higher coal royalty tons. Net income for the quarter was $95.1 million, and adjusted EBITDA rose to $185.8 million, a 9% increase year-over-year. The company ended the quarter with $541.8 million in total liquidity and generated $151.4 million in free cash flow. For the full year 2025, Alliance tightened its sales guidance to 32.5 to 33.25 million tons, with favorable market conditions and increased long-term contracts supporting its outlook.Alliance Resource Financial Statement Overview
Summary
Alliance Resource demonstrates strong financial health with robust profitability and a solid balance sheet. Despite challenges in revenue growth, the company maintains efficient operations and strong cash flow generation. The low leverage and effective use of equity provide a stable financial foundation.Income Statement
Alliance Resource has demonstrated strong profitability with a high net profit margin of 42.35% in the TTM period, despite a slight decline in revenue growth. The gross profit margin has decreased compared to previous years, indicating some pressure on cost management. However, the company maintains solid EBIT and EBITDA margins, reflecting efficient operations.75
Positive
Balance Sheet
The company exhibits a strong balance sheet with a low debt-to-equity ratio of 0.018 in the TTM period, indicating low leverage and financial stability. The return on equity remains robust at 18.21%, showcasing effective use of shareholder funds. The equity ratio is healthy, suggesting a solid capital structure.80
Positive
Cash Flow
Alliance Resource has shown positive free cash flow growth of 14.53% in the TTM period, indicating improved cash generation. The operating cash flow to net income ratio is low, suggesting potential inefficiencies in converting income into cash. However, the free cash flow to net income ratio remains strong, reflecting good cash profitability.70
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.25B | 2.45B | 2.57B | 2.42B | 1.57B | 1.33B |
| Gross Profit | 414.43M | 507.48M | 751.49M | 741.20M | 289.36M | 133.96M |
| EBITDA | 610.44M | 702.17M | 948.52M | 956.14M | 483.47M | 234.02M |
| Net Income | 244.83M | 360.86M | 630.12M | 586.20M | 182.77M | -129.05M |
Balance Sheet | ||||||
| Total Assets | 2.91B | 2.92B | 2.79B | 2.73B | 2.16B | 2.17B |
| Cash, Cash Equivalents and Short-Term Investments | 94.48M | 136.96M | 59.81M | 296.02M | 122.40M | 55.57M |
| Total Debt | 471.55M | 486.80M | 350.82M | 434.31M | 450.66M | 609.78M |
| Total Liabilities | 1.08B | 1.06B | 929.83M | 1.02B | 933.34M | 1.09B |
| Stockholders Equity | 1.81B | 1.83B | 1.83B | 1.61B | 1.21B | 1.06B |
Cash Flow | ||||||
| Free Cash Flow | 364.00M | 374.39M | 362.08M | 515.96M | 272.20M | 280.53M |
| Operating Cash Flow | 675.68M | 803.13M | 830.64M | 802.35M | 426.14M | 401.63M |
| Investing Cash Flow | -336.21M | -440.66M | -559.73M | -403.34M | -143.63M | -126.11M |
| Financing Cash Flow | -422.49M | -285.32M | -507.12M | -225.39M | -215.69M | -256.43M |
Alliance Resource Technical Analysis
Positive
24.43
Price Trends
23.97
Positive
23.88
Positive
24.31
Negative
Market Momentum
0.21
Negative
52.37
Neutral
22.22
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARLP, the sentiment is Positive. The current price of 24.43 is above the 20-day moving average (MA) of 24.16, above the 50-day MA of 23.97, and above the 200-day MA of 24.31, indicating a neutral trend. The MACD of 0.21 indicates Negative momentum. The RSI at 52.37 is Neutral, neither overbought nor oversold. The STOCH value of 22.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ARLP.
Alliance Resource Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $3.14B | 12.92 | 13.07% | 11.05% | -9.45% | -46.37% | |
67 Neutral | $1.50B | 10.44 | 26.19% | 4.05% | -14.79% | -17.10% | |
65 Neutral | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
61 Neutral | $4.86B | 138.36 | 1.67% | 0.36% | -23.25% | -90.78% | |
61 Neutral | $4.39B | -121.44 | -0.87% | 0.96% | -7.21% | -106.39% | |
56 Neutral | $1.42B | -38.73 | -7.40% | 2.83% | -16.99% | -184.02% | |
54 Neutral | $2.85B | -60.46 | -2.87% | ― | -32.53% | -112.77% |
* Energy Sector Average
ARLP
Alliance Resource
24.31
-1.40
-5.45%
NRP
Natural Resource PRN
114.25
13.11
12.96%
AMR
Alpha Metallurgical Resources
215.74
28.84
15.43%
METC
Ramaco Resources
22.58
13.63
152.29%
HCC
Warrior Met Coal
90.09
36.94
69.50%
BTU
Peabody Energy Comm
35.18
17.13
94.90%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.