Ramaco Resources, Inc.

Ramaco Resources, Inc. (NASDAQ: METC) is a United States-based coal producer. Metallurgical coal is used to manufacture metallurgical coke as its only revenue-generating product. Customers include blast furnace steel mills and coke facilities in the United States and foreign metallurgical coal consumers.

Key Highlights:

• For the full year FY21, net income was USD 39.8 million (EPS of USD 0.90), and adjusted EBITDA was USD 79.0 million. Net income and Adjusted EBITDA were up 59% and 43%, respectively, over the previous year's records.
• The company had scheduled 1.7 million tons of metallurgical coal for domestic delivery in 2022 at USD 196 per short ton FOB mine as of December 31, 2021, excluding carryover tons from 2021.
• METC published a statement on February 28, 2022, regarding the death of Steven H. Hively of Philippi, West Virginia, at the Berwind Mine Complex, owned by Ramaco Resources, LLC, a subsidiary of the company.
• On February 28, 2022, Wohl & Fruchter LLP launched an investigation into whether METC's board of directors acted in the best interests of its shareholders by agreeing to pay USD 65 million in cash to related parties to buy 100% of the equity interests in Ramaco Coal, LLC.
• Stock is currently trading far above its crucial short-term (50-day) and long-term (200-day) SMA support levels, and RSI is at 61.72, indicating an overbought zone.
• Stock is leaning towards the higher-band of the 52-week range of USD 3.83 to USD 20.92.
• METC stock price has surged 225.51% and 293.27% in the past nine and twelve months, respectively.

Conclusion:

Considering the company's strong bottom-line performance, a significant surge in the stock price, ongoing investigations, macroeconomic headwinds, and hyped technical indicators, we recommend a "Watch" rating on the stock at the current price of USD 19.25, down 7.00% as of March 11, 2022, at 10:40 AM ET.

Three-Year Technical Price Chart (as of March 11, 2022, at 10:40 AM ET). Source: REFINITIV, Analysis by Kalkine Group

Technical Analysis Summary:

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decision should be made depending on the investors' appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above. 

SunCoke Energy, Inc.

SunCoke Energy, Inc. (NYSE: SXC) is a coke producer based in the Americas. Domestic Coke, Brazil Coke, and Logistics are the company's three segments. It has both metallurgical and thermal coal available.

Key Highlights:

• The company reported a 9.23% increase in revenues to USD 1.46 billion in FY21 (ended December 31, 2021) from USD 1.33 billion in FY20.
• SXC reported a significant increase in net income to USD 48.8 million in FY21, from USD 8.8 million in FY20.
• At the end of FY21, SXC's debt/equity ratio was 1.23x, significantly higher than the industry norm of 0.23x.
• It reported Gross and EBITDA margins of 23.2% and 18.9% in FY21, respectively, which are much lower than the industry medians of 49.6% and 41.0%.
• Stock is currently trading far above its crucial short-term (50-day) and long-term (200-day) SMA support levels, and the RSI is at 59.17, indicating an overbought zone.
• Stock is leaning towards the higher-band of the 52-week range of USD 5.85 to USD 9.82.
• SXC's stock price has surged 36.09% and 23.72% in the past three and six months, respectively.

Conclusion:

Considering the surge in the stock price in a brief span, improving fundaments, industry lagging metrics, macro headwinds, high debt, and other technical indicators, we recommend a "Watch" rating on the stock at the current price of USD 8.71, down 1.80% as of March 11, 2022, at 10:43 AM ET.

Three-Year Technical Price Chart (as of March 11, 2022, at 10:43 AM ET). Source: REFINITIV, Analysis by Kalkine Group

Technical Analysis Summary:

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario.

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decision should be made depending on the investors' appetite on upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above.