Contrasting Arch Coal (ARCH) and Puda Coal (PUDA)

Arch Coal (NYSE:ARCH) and Puda Coal (OTCMKTS:PUDA) are both small-cap basic materials companies, but which is the better investment? We will contrast the two companies based on the strength of their analyst recommendations, risk, institutional ownership, profitability, earnings, dividends and valuation.

Analyst Ratings

This is a breakdown of recent ratings and target prices for Arch Coal and Puda Coal, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Arch Coal 0 3 4 0 2.57
Puda Coal 0 0 0 0 N/A

Arch Coal presently has a consensus price target of $106.14, indicating a potential upside of 11.87%. Given Arch Coal’s higher possible upside, equities analysts plainly believe Arch Coal is more favorable than Puda Coal.

Risk and Volatility

Arch Coal has a beta of -0.11, suggesting that its stock price is 111% less volatile than the S&P 500. Comparatively, Puda Coal has a beta of -25.56, suggesting that its stock price is 2,656% less volatile than the S&P 500.

Profitability

This table compares Arch Coal and Puda Coal’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Arch Coal 13.03% 49.50% 16.80%
Puda Coal N/A N/A N/A

Valuation and Earnings

This table compares Arch Coal and Puda Coal’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Arch Coal $2.32 billion 0.77 $238.45 million $11.36 8.34
Puda Coal N/A N/A N/A N/A N/A

Arch Coal has higher revenue and earnings than Puda Coal.

Insider & Institutional Ownership

45.9% of Arch Coal shares are owned by institutional investors. 0.3% of Arch Coal shares are owned by company insiders. Comparatively, 48.3% of Puda Coal shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Arch Coal pays an annual dividend of $1.60 per share and has a dividend yield of 1.7%. Puda Coal does not pay a dividend. Arch Coal pays out 14.1% of its earnings in the form of a dividend.

Summary

Arch Coal beats Puda Coal on 9 of the 11 factors compared between the two stocks.

Arch Coal Company Profile

Arch Coal, Inc. produces and sells thermal and metallurgical coal from surface and underground mines. As of December 31, 2017, the company operated 9 active mines located in Wyoming, West Virginia, Kentucky, Virginia, Colorado, and Illinois. It also owned or controlled, primarily through long-term leases, approximately 28,292 acres of coal land in Ohio; 1,060 acres of coal land in Maryland; 10,108 acres of coal land in Virginia; 359,160 acres of coal land in West Virginia; 98,488 acres of coal land in Wyoming; 267,857 acres of coal land in Illinois; 34,446 acres of coal land in Kentucky; 9,840 acres of coal land in Montana; 21,802 acres of coal land in New Mexico; 358 acres of coal land in Pennsylvania; and 20,165 acres of coal land in Colorado, as well as owned or controlled through long-term leases smaller parcels of property in Alabama, Indiana, Washington, Arkansas, California, Utah, and Texas. The company sells its products to utility, industrial, and steel producers in the United States and internationally. Arch Coal, Inc. was founded in 1969 and is headquartered in St. Louis, Missouri.

Puda Coal Company Profile

Puda Coal, Inc., through its indirect equity ownership in Shanxi Puda Coal Group Co., Ltd., supplies metallurgical coking coal in the People's Republic of China. Its processed coking coal is used by coke and steel producers for the purpose of making the coke required for the steel manufacturing process. The company primarily markets its products in the Shanxi Province, Inner Mongolia Autonomous Region, Hebei Province, Beijing, and Tianjin. It also operates as an acquirer and consolidator of two coal mine consolidation projects, including the Pinglu project in Pinglu County; and the Jianhe project in Huozhou County, Shanxi Province. The company was founded in 2004 and is headquartered in Taiyuan, the People's Republic of China.

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