By Nicholas Jordan

April 1, 2018 - Contura Energy (OTCMKTS: CNTE) and Alliance Holdings GP (NASDAQ:AHGP) are both small-cap oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their dividends, valuation, earnings, institutional ownership, analyst recommendations, risk and profitability.

Dividends

Alliance Holdings GP pays an annual dividend of $2.97 per share and has a dividend yield of 11.9%. Contura Energy does not pay a dividend. Alliance Holdings GP pays out 92.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Institutional & Insider Ownership

0.9% of Contura Energy shares are held by institutional investors. Comparatively, 21.4% of Alliance Holdings GP shares are held by institutional investors. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Contura Energy and Alliance Holdings GP’s net margins, return on equity and return on assets.

Earnings and Valuation

This table compares Contura Energy and Alliance Holdings GP’s revenue, earnings per share and valuation.

Alliance Holdings GP has higher revenue and earnings than Contura Energy. Contura Energy is trading at a lower price-to-earnings ratio than Alliance Holdings GP, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a summary of recent recommendations for Contura Energy and Alliance Holdings GP, as provided by MarketBeat.com.

Contura Energy currently has a consensus price target of $80.00, indicating a potential upside of 19.40%. Alliance Holdings GP has a consensus price target of $32.00, indicating a potential upside of 27.95%. Given Alliance Holdings GP’s higher possible upside, analysts plainly believe Alliance Holdings GP is more favorable than Contura Energy.

Summary

Alliance Holdings GP beats Contura Energy on 8 of the 14 factors compared between the two stocks.

About Contura Energy

Contura Energy, Inc. extracts, processes, and markets steam and metallurgical coal to electric utilities, steel and coke producers, and industrial customers the United States. The company operates in four segments: Central Appalachia Operations, Northern Appalachia Operations, Powder River Basin Operations, and Trading and Logistics. It operates ground and surface coal mining complexes in Pennsylvania, Virginia, West Virginia, and Wyoming. The company provides coal trading and terminal services. Contura Energy, Inc. was founded in 2016 and is headquartered in Bristol, Tennessee.

About Alliance Holdings GP

Alliance Holdings GP, L.P. (AHGP) is a limited partnership company. The Company owns directly and indirectly the members’ interest in Alliance Resource Management GP, LLC (MGP), the managing general partner of Alliance Resource Partners, L.P. (ARLP). The Company’s segments include Illinois Basin, Appalachia, and Other and Corporate. The Illinois Basin segment consists of mining complexes, including Webster County Coal’s Dotiki mining complex; Gibson County Coal’s mining complex, which includes the Gibson North mine and Gibson South mine; Warrior’s mining complex; River View’s mining complex and the Hamilton mining complex. The Appalachia segment consists of various operating segments, including the Mettiki mining complex, the Tunnel Ridge mining complex and the MC Mining mining complex. The Mettiki mining complex includes Mettiki Coal (WV)’s Mountain View mine and Mettiki Coal’s preparation plant. Other and Corporate segment includes marketing and administrative activities. 

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