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Daily Report 9/30/2025

METC Buy [Research Report]

AI Assisted
(I) Summary
(a) Investment Conclusion:
Rating: BUY at 7/7/2025
Action: BUY at $49.46 at 7/7/2025
(b) Company Description and Key Metrics
Ramaco Resources, Inc. (NASDAQ: METC, METCB) operates and develops coal mining properties primarily in West Virginia, Virginia, and Pennsylvania. The company specializes in producing premium low-volatile metallurgical (coking) coal, a critical component for steel manufacturing, selling to both domestic and international steelmakers.
Headquarters: Lexington, Kentucky, USA.
Founded: August 2015
Went Public: February 2017
Employees: Approximately 811
Key Metrics (As of July 3, 2025, or Latest Trailing Twelve Months (TTM)):
Market Cap: ~$615.57 Million, with 41.41 shares outstanding, and 28.6 million shares in float, 3.79 short at 7/7/2025, a 3.49 ration and 13.36% short float.
Total Debt (Most Recent): $125.17 Million (Source: Latest 10-Q or 10-K filing)
Total Cash (Most Recent): 43.47 Million (Source: Latest 10-Q or 10-K filing)
Trailing Twelve Months (TTM) Sales (Revenue): $628.27 Million (Source: Latest company earnings release or financial data provider)
TTM Gross Profit Margin: 19.19%
TTM Diluted EPS: -$0.01
Dividend (Annualized): $0.55 per share estimated, $0.13 ttm, 1.02%
Dividend Yield: 4.61%
Payout Ratio: Negative
Book Value (TTM Price to Book): $6.50 and 1.84x
Cash Per Share: $0.79 (Source: Calculation from cash and shares outstanding).
⁠
Yahoo Estimates for METC
⁠
:
EPS 2025: -$0.25, -$0.05; -$0.60, $0.60 EPS on $131.55mm, $168.3mm, $608.1mm and $706.0mm revenue for 2Q2025, 3Q2025, 2025 and 2026, respectively.
Basic Earnings Multiples (based on latest TTM and current price):
P/E Ratio (ttm): N/A (due to negative EPS)
Forward P/E (2025 Consensus): ~49.75x (Source: Calculation from current price and 2025 consensus EPS)
Price to Sales (ttm): 0.99x (Source: Calculation from market cap and TTM sales)
Price to Book (ttm): 1.84x (Source: Calculation from market cap and total book value)
(c) Investor Sentiment: Risks & Rewards
Rewards / Market Opportunities: Ramaco is positioned as a low-cost producer of premium metallurgical coal, with growth initiatives aimed at significantly increasing production volumes. Its strong contract book provides revenue visibility. Long-term global steel demand, especially from developing economies, remains a supportive factor for the industry. The company also offers consistent shareholder returns through dividends.
Risks / Challenges: The primary risks include flat growth for steel and metallurgic coal demand, and environmental pressures on the coal and steel industries. Operational execution risks related to expanding mining activities and geopolitical disruptions also exist.
(II) Market in which the Company Operates (Metallurgical Coal Market)
Ramaco Resources operates within the global metallurgical coal market.
Quantification and Geographic Segmentation of Metallurgical Coal Demand:
To visualize, use charting software to create a stacked bar graph with the data below, showing the demand evolution by region.
See the industry page
Competition
Table 1
Company
Est. 2023 Prod.
Column 3
Company
Estimated 2023 Production (Mt)
Estimated North American Market Share (Rough %)
Teck Resources Limited (Canada)
23.7
~24-26%
Arch Resources Inc. (USA)
9.3
~9-10%
Warrior Met Coal, Inc. (USA)
7.6
~7-8%
Coronado Global Resources Inc. (US Ops)
6.2
~6-7%
Alpha Metallurgical Resources, Inc. (US Ops)
16.2
~5-6%
Ramaco Resources, Inc. (USA)
3.1
~3-4%
Other Smaller/Private Producers
Remainder
Variable
Total North America (Estimated)
~90-100
100%
There are no rows in this table
⁠
Source: Gemini AI citing Company reports, U.S. Energy Information Administration (EIA), Natural Resources Canada.

(III) Market in which the Company Sells To (Crude Steel Market)

Ramaco Resources sells its metallurgical coal to the global crude steel industry.
Quantification and Geographic Segmentation of Crude Steel Production:
Use charting software to create a stacked bar graph with the data below, showing the steel production evolution by region.
Combined Historical and Forecasted Global Crude Steel Production by Region (Million Tonnes - Mt)
See industry page

(IV) Analysis of Directors and Managers

Ramaco Resources' board and management team have extensive backgrounds in the coal industry, law, and government.
Direct Industry Ties: Leaders like Randall W. Atkins (Founder, Chairman, CEO) have over 40 years of experience in energy and commodities and hold positions on industry boards (e.g., National Coal Council, National Mining Association).
Direct Political Ties: Evan H. Jenkins (Vice-Chairman, Secretary) is a former U.S. Congressman and Chief Justice. Joseph Manchin III, a former U.S. Senator, joined the board in April 2025. These individuals bring significant political experience and networks relevant to the energy and regulatory landscape.
Next Steps: To quantify financial contributions to politicians, track PAC (Political Action Committee) memberships, and identify interlocking boards, consult public campaign finance databases (e.g., the Federal Election Commission - FEC website) and corporate governance research services (e.g., BoardEx, Equilar, or proxy statements filed with the SEC).
(V) Ownership
Summary of Shares Outstanding and Change:
Ramaco Resources has two classes of common stock (Class A: METC; Class B: METCB). The approximate total shares outstanding are around 58-60 million. Class A shares outstanding are roughly 58.46 million as of July 3, 2025. Shares outstanding have generally seen an increase over recent years, often due to growth initiatives and stock-based compensation. METC has 41.41 million shares outstanding, and 28.6 million shares in float.
Current Owners and Institutional Holdings:
Ownership is distributed among institutional investors (~23.49%), insiders (~40.49%), and public (retail) investors (~36.02%).
METC Owners at 7/7/2025
Column 1
Column 2
⁠
​Changes in historical ownership: To be determined.
Insider - all sells.
Short Interest:
Next Steps: According to
Finviz.com
⁠
METC has 41.41 million shares outstanding, and 28.6 million shares in float, 3.79 short at 7/7/2025, a 3.49 ration and 13.36% short float.
Top Ten Owners Historically (at end of each calendar year for the last several years):
Next Steps: Historical changes to be developed.

(VI) Financial Analysis of P&L, Balance Sheet, and Forecast


P&L Highlights (Trailing Twelve Months (TTM) as of Q1 2025 / FY 2024):
Revenue (TTM): $628.27M (Source: Company earnings releases and 10-K/10-Q filings)
Gross Profit Margin (TTM): 19.19%
Operating Margin (TTM): -0.41%
Net Income (TTM): -$0.05M
EBITDA (TTM): $66.89M
Balance Sheet Highlights (Most Recently Available, likely Q1 2025):
Total Cash: $43.47M (Source: Company 10-Q/10-K filings)
Total Debt: $125.17M
Current Ratio: 1.32x
Net Debt to Adjusted EBITDA: 0.5x (as of FY 2024)
Forecast (2025 - Consensus Estimates):
Sales 2025: ~$685.32 Million (Source: Analyst consensus from financial data providers)
EPS 2025: ~$0.24
Production Guidance 2025: 4.2 – 4.6 million tons (Source: Company earnings call transcripts and investor presentations)
Sales Guidance 2025: 4.4 – 4.8 million tons
Cash Cost of Sales 2025: $97 - $103 per ton
Capital Expenditures 2025: $60 - $70 million
Common Size Comparisons to Competitors: To be created.

(VII) Profitability and Efficiency Analysis

Here is a summary of key profitability, efficiency, and debt coverage metrics for Ramaco Resources and its publicly traded peers, based on the latest available financial data (mostly Trailing Twelve Months (TTM) ending Q1 2025 or Full Year 2024, as available).
Comparison of Key Metrics (Latest Available TTM/FY)
Comparable Valuation Metrics
Column 1
METC
HCC
AMR
BTU
Gross Margin
19.19%
23.9% (TTM Mar'25)
26.1% (TTM Mar'25)
16.7% (TTM Mar'25)
Operating Margin
-0.41%
15.6% (TTM Mar'25)
18.0% (TTM Mar'25)
7.9% (TTM Mar'25)
Net Margin
-0.01%
11.2% (TTM Mar'25)
12.1% (TTM Mar'25)
5.3% (TTM Mar'25)
Return on Assets (ROA)
-0.24%
12.1% (TTM Mar'25)
17.5% (TTM Mar'25)
4.8% (TTM Mar'25)
Return on Equity (ROE)
-0.08%
17.2% (TTM Mar'25)
25.0% (TTM Mar'25)
8.8% (TTM Mar'25)
Efficiency
​
​
​
​
Revenue Growth (YoY, FY24)
-10.23%
-21.4% (FY24)
-32.8% (FY24)
-24.8% (FY24)
EBITDA Growth (YoY, FY24)
-46.78%
-38.5% (FY24)
-53.2% (FY24)
-62.6% (FY24)
Debt Coverage
​
​
​
​
Total Debt/Equity
35.24%
10.9% (Mar'25)
17.6% (Mar'25)
28.5% (Mar'25)
Net Debt/Adjusted EBITDA
0.5x (FY24)
-0.1x (Mar'25)
-0.3x (Mar'25)
0.4x (Mar'25)
There are no rows in this table
⁠
Analysis Summary:
Ramaco's profitability metrics (Gross, Operating, Net Margins, ROA, ROE) for the trailing twelve months are significantly lower than its peers and show a net loss, indicating that the recent metallurgical coal pricing environment has been more challenging for Ramaco relative to its current scale of operations compared to its larger, more established competitors who still manage positive margins.
In terms of efficiency, all companies in this sector experienced negative revenue and and EBITDA growth year-over-year in FY2024, reflecting the softening of met coal prices from 2022 highs. Ramaco's EBITDA growth decline was notable, but in line with industry trends.
Regarding debt coverage, Ramaco maintains a healthy balance sheet with a low Net Debt/Adjusted EBITDA ratio (0.5x), indicating strong capacity to service its debt. This is comparable to, though slightly higher than, the negative (net cash) positions of HCC and AMR, and similar to BTU's low leverage. This financial strength provides a buffer against commodity price volatility.

(VIII) Insights: Vendors, Customers, Market Reports, Macroeconomic Data

Public Company Vendors: Ramaco's primary vendors include heavy equipment manufacturers (e.g., Caterpillar, Komatsu), specialized mining service providers, and energy suppliers.
Next Steps: Future review of earnings reports and transcripts.
Public Company Customers: Ramaco primarily sells to integrated steel producers globally. They have committed sales to North American and export customers. Ramaco has publicly stated ~3.7 million tons in 2025 is already contracted (~90% at midpoint of guidance), with 1.6 million tons to North American customers at an average realized price of $152/ton, and 1.3 million tons at index-linked pricing to export customers.
Next Steps: Future review of earnings reports and transcripts.
Market Reports:
Metallurgical Coal Market: Expected to grow from $68.52 billion in 2023 to $89.0 billion by 2032 (CAGR of 2.95%). This points to a modest long-term expansion of the market Ramaco operates in.
Steel Market: Valued at $951.05 billion in 2023, projected to reach $1,200 billion by 2035 (CAGR of 1.96%). This indicates underlying demand for steel products.
Macroeconomic Data:
Global GDP Growth: Recently adjusted downward by US Federal Reserve, an incremental negative.
Industrial Production: Key driver of steel consumption.
Interest Rates & Inflation: Interest rate direction is unclear.
USD Strength: Trend of US dollar is downward.
Next Steps: To provide quantified insights on future financials: Regularly monitor reports from the IMF, World Bank, and central banks for global and regional GDP forecasts, industrial production indices, and interest rate outlooks. Analyze how these trends are explicitly linked to the steel and metallurgical coal demand outlooks by industry associations (e.g., World Steel Association) or major commodity analysts.

(IX) Regulatory Changes with Material Impact

Regulatory changes, particularly in environmental policy, can significantly affect the metallurgical coal market and Ramaco.
One Big Beautiful Bill Act (OBBA) gives additional credits and interest rate deductions for companies like METC.
Carbon Emissions Regulations (Steel Industry): Carbon emissions limits are a net negative.
Mine Permitting & Environmental Standards: Recent U.S. Federal permit streamlining permitting proc.
Next Steps for Quantification: TBD.
Transportation Regulations: TBD.
Next Steps for Quantification: TTBD.

(X) Sell Side, Traditional Financial Media, and Metadata regarding the Stock

Sell Side Opinion:
Coverage: Ramaco Resources (METC) is covered by a small number of Wall Street analysts; coverage is not active.
Average Rating: The consensus rating is generally "Buy."
Average Price Target: Analysts provide a consensus price target (e.g., ~$13.57).
Traditional Financial Media:
Treatment:
Next Steps: .
Metadata:
Next Steps: To analyze meta data such as tweet sentiment, search trends, and other similar information related to the stock:
Utilize specialized social media analytics platforms (e.g., Brandwatch, Meltwater, Symeon) to track mentions of "METC" or "Ramaco Resources" on platforms like X (Twitter) and gauge sentiment (positive, negative, neutral).
Use search trend tools (e.g., Google Trends) to monitor search interest for "Ramaco stock" or "METC share price" over time, which can indicate retail investor engagement.
Monitor dedicated stock discussion forums (e.g., StockTwits, relevant subreddits) for discussion volume and prevailing sentiment.

(XI) Valuation

The following is a basic valuation comparison table
METC Basic Valuation Comp at 7/7/2025
Column 1
Column 2
Column 3
Column 4
Column 5
Multiple
Ramaco Resources (RAMC)
Warrior Met Coal (HCC)
Alpha Metallurgical Resources (AMR)
Peabody Energy (BTU)
P/E (TTM)
N/A (Negative EPS)
~21.0x
~53.9x
~7.0x - 8.0x
Forward P/E (2025 Est.)
~49.8x
~22.1x
N/A (AMR's fwd P/E is often volatile/not directly comparable due to forecast)
~4.8x
Price/Sales (TTM)
0.99x
1.98x
~0.5x
~0.4x - 0.5x
Price/Book (TTM)
1.84x
1.27x
0.85x
~0.4x - 0.5x
EV/EBITDA (TTM)
~10.0x
~6.6x - 9.1x
~3.9x - 4.5x
~2.2x
There are no rows in this table
⁠
Analysis:
P/E Ratios: Ramaco's negative TTM EPS makes its trailing P/E incalculable, highlighting its recent profitability challenges. Its forward P/E (based on 2025 estimates) is significantly higher than peers, suggesting that the market is assigning a premium to its future growth or that current earnings are expected to remain low relative to its price.
Price/Sales: Ramaco's P/S is higher than AMR and BTU, but lower than HCC. This suggests that per dollar of revenue, Ramaco's market capitalization is valued more highly than the larger, lower-margin Peabody, but less than Warrior Met, a pure-play met coal producer.
Price/Book: Ramaco's P/B is higher than its peers, indicating that its market value is a larger multiple of its book value per share. This could be due to growth expectations or different asset bases.
EV/EBITDA: Ramaco's EV/EBITDA multiple appears higher than its direct pure-play met coal peers (HCC, AMR) and significantly higher than BTU. A higher EV/EBITDA implies that investors are willing to pay more for each dollar of Ramaco's operational cash flow before non-operating expenses. This could reflect higher growth expectations, a perceived lower risk profile, or that its current EBITDA is temporarily depressed.
Conclusion: Based on these multiples, Ramaco appears to trade at a premium on a forward P/E basis compared to its peers, and a higher EV/EBITDA, despite its recent negative TTM EPS and lower current profitability margins. This could be indicative of the market pricing in its strong growth potential and low-cost position, or it could suggest it is relatively expensive compared to its peers if that growth does not materialize or if met coal prices remain subdued.

(XII) Technical Analysis of the Stock

Key Technical Indicators & Outlook:
Current Price: ~$11.94 (as of July 3, 2025)
52-Week Range: ~$6.25 - $15.20
Moving Averages: The current stock price relative to its 50-day and 200-day moving averages suggests the short and long-term trends.
RSI (Relative Strength Index), MACD (Moving Average Convergence Divergence), Volume: These are momentum and trend indicators.
Next Steps: For a comprehensive technical analysis, use a professional charting platform (e.g., TradingView, Bloomberg Terminal, MetaStock, thinkorswim) with live and historical stock data.
Generate Charts: Plot RAMC's price data over various timeframes (e.g., 1-year daily, 5-year weekly).
Identify Patterns: Look for common chart patterns (e.g., head and shoulders, double tops/bottoms, triangles) and candlestick patterns that might signal reversals or continuation.
Plot Indicators: Apply moving averages (e.g., 20-day, 50-day, 200-day), RSI, MACD, and Bollinger Bands.
Determine Support & Resistance: Identify key price levels where buying interest (support) or selling pressure (resistance) historically emerged.
Analyze Volume: Observe trading volume accompanying price movements to confirm the strength of trends.
(XIII) Guidance and Estimates
Current Guidance (Latest from Company):
Full-Year 2025 Sales Volume Guidance: 4.4 – 4.8 million tons.
Full-Year 2025 Production Volume Guidance: 4.2 – 4.6 million tons.
Cash Cost of Sales 2025: $97 - $103 per ton.
Capital Expenditures 2025: $60 - $70 million.
Next Steps: For the most current and detailed management guidance (including any quarterly specific guidance), review Ramaco Resources' latest earnings call transcripts and investor presentations, typically available on their investor relations website.
Changes from Recent Prior Guidance:
Ramaco has recently raised its 2024 sales and production guidance, indicating confidence in their operational ramp-up.
Analyst Estimates (Consensus):
2025 Sales Estimate: ~$685.32 Million
2025 EPS Estimate: ~$0.24
Changes from Recent Prior Estimates:
Analysts have revised some full-year EBITDA and quarterly EPS estimates downward due to various factors (e.g., Q3 2024 production, market conditions).
Next Steps: For the latest analyst estimate changes, including the magnitude and direction of revisions for both current and future quarters/years, consult financial data platforms that track consensus estimates (e.g., Refinitiv Eikon, FactSet, Zacks). This provides insight into how professional expectations are evolving.
(XIV) Concise Investment Conclusion
Stance: Hold
Action: Hold
Price Target: $13.57 (Based on analyst consensus data as of July 4, 2025)
Downside Risk (Potential Low End of Price): A plausible downside could be towards the $7.00 - $8.00 range, representing a significant decline from current levels, especially if metallurgical coal prices experience a severe downturn or the company faces significant operational setbacks.
Ramaco Resources is a growing producer of high-quality metallurgical coal with a strong balance sheet. However, the inherent volatility of the metallurgical coal market and recent short-term profitability challenges warrant a cautious "Hold" position. While long-term tailwinds from global steel demand, particularly from India and Southeast Asia, exist, investors should monitor the company's ability to consistently execute its growth plans and navigate price fluctuations. Maintain current positions and observe.
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