Jefferies Downgrades Ramaco Resources to Hold, Adjusts Price Target

Jefferies Financial Group has downgraded shares of Ramaco Resources (NASDAQ: METC) from a “buy” rating to a “hold” rating, according to a research note published on October 8, 2023. The firm has set a new target price of $33.00 for the energy company, a reduction from the previous target of $45.00. This decision highlights a shift in market sentiment regarding the company’s stock performance.

Several other research firms have also provided updates on Ramaco Resources. On the same day as Jefferies’ downgrade, Northland Capital Markets raised its rating on the company to “strong buy.” In contrast, Zacks Research downgraded the stock from a “hold” to a “strong sell” just a few days later, on October 13, 2023. Northland Securities initiated coverage with an “outperform” rating and a price target of $50.00. Additionally, B. Riley increased its price objective from $14.00 to $50.00, assigning the stock a “buy” rating.

Currently, the consensus among analysts is mixed. According to MarketBeat.com, two analysts rate the stock as a “strong buy,” four as a “buy,” two as a “hold,” and one as a “sell.” The average rating stands at “moderate buy,” with a consensus target price of $41.60.

Quarterly Earnings Report and Insider Trading

Ramaco Resources recently released its quarterly earnings report on October 27, 2023. The company reported earnings of ($0.25) per share, surpassing the consensus estimate of ($0.30) by $0.05. Despite this positive earnings surprise, the company experienced a negative return on equity of 8.26% and a net margin of 5.67%. Revenue for the quarter was reported at $121.00 million, which fell short of analysts’ expectations of $137.63 million. Compared to the same quarter last year, revenue decreased by 27.7%.

In terms of insider trading, Director Peter A. Leidel sold 1,600,000 shares of Ramaco Resources on August 8, 2023, at an average price of $18.75, totaling approximately $30,000,000. Following the sale, Leidel retained 2,502,930 shares valued at around $46,929,937.50, marking a 39.00% reduction in his holdings. Company insiders collectively own 36.20% of the company’s stock.

Institutional Investment Activity

Institutional investors have been active in adjusting their stakes in Ramaco Resources. Brooklyn Investment Group acquired a new stake in the first quarter, valued at $25,000. Ameritas Investment Partners Inc. increased its holdings by 63.9% in the second quarter, raising its total to 3,632 shares worth $48,000. The State of Wyoming also entered with a new position valued at about $50,000.

Additional activity includes AlphaQuest LLC, which boosted its stake by 30.6%, now holding 6,332 shares valued at $52,000. Notably, Farther Finance Advisors LLC increased its position by 384.0%, owning 3,920 shares worth $52,000.

As it stands, institutional investors hold 74.49% of Ramaco Resources’ stock, indicating a significant level of confidence in the company’s long-term prospects despite recent fluctuations.

Company Overview and Future Outlook

Ramaco Resources, Inc. focuses on the development, operation, and sale of metallurgical coal. Its key projects include the Elk Creek project in southern West Virginia, the Berwind property on the West Virginia-Virginia border, and the Knox Creek property in Virginia, among others.

Looking ahead, analysts expect Ramaco Resources to post an earnings per share (EPS) of $0.05 for the current year, suggesting a cautious optimism amid the recent adjustments in ratings and stock performance.

As market dynamics continue to evolve, stakeholders will be paying close attention to upcoming reports and analyst updates to gauge Ramaco Resources’ trajectory in the competitive energy sector.