Contrasting Ramaco Resources (NASDAQ:METCB) & Royal Gold (NASDAQ:RGLD)

Ramaco Resources (NASDAQ:METCB) and Royal Gold (NASDAQ:RGLD) are both materials companies, but which is the better business? We will contrast the two businesses based on the strength of their valuation, dividends, profitability, earnings, analyst recommendations, risk and institutional ownership.

Insider and Institutional Ownership

9.6% of Ramaco Resources shares are held by institutional investors. Comparatively, 83.7% of Royal Gold shares are held by institutional investors. 0.3% of Royal Gold shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock will outperform the market over the long term.

Risk and Volatility

Ramaco Resources has a beta of 1.37, suggesting that its share price is 37% more volatile than the S&P 500. Comparatively, Royal Gold has a beta of 0.45, suggesting that its share price is 55% less volatile than the S&P 500.

Profitability

This table compares Ramaco Resources and Royal Gold’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Ramaco Resources	-11.98%	-13.54%	-6.01%
Royal Gold	47.74%	12.06%	9.41%

Analyst Ratings

This is a summary of recent ratings and recommmendations for Ramaco Resources and Royal Gold, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Ramaco Resources	1	0	0	0	1.00
Royal Gold	0	3	9	0	2.75

Royal Gold has a consensus price target of $295.80, suggesting a potential upside of 22.55%. Given Royal Gold’s stronger consensus rating and higher probable upside, analysts clearly believe Royal Gold is more favorable than Ramaco Resources.

Valuation and Earnings

This table compares Ramaco Resources and Royal Gold”s revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Ramaco Resources	$536.62 million	0.45	-$51.45 million	($1.07)	-3.57
Royal Gold	$1.03 billion	19.85	$467.27 million	$9.16	26.35

Royal Gold has higher revenue and earnings than Ramaco Resources. Ramaco Resources is trading at a lower price-to-earnings ratio than Royal Gold, indicating that it is currently the more affordable of the two stocks.

Summary

Royal Gold beats Ramaco Resources on 13 of the 14 factors compared between the two stocks.

About Ramaco Resources

Ramaco Resources, Inc. engages in the development, operation, and sale of metallurgical coal. Its development portfolio includes the Elk Creek project that covers an area of approximately 20,200 acres located in southern West Virginia; the Berwind property covering an area of approximately 62,500 acres situated on the border of West Virginia and Virginia; the Knox Creek property, which covers an area of approximately 64,050 acres is located in Virginia; the Maben property covering an area of approximately 28,000 acres situated in southwestern Pennsylvania southern West Virginia; and the Brook Mine property that covers an area of approximately 16,000 acres located in northeastern Wyoming. The company serves blast furnace steel mills and coke plants in the United States, as well as metallurgical coal consumers internationally. Ramaco Resources, Inc. was founded in 2015 and is headquartered in Lexington, Kentucky.

About Royal Gold

Royal Gold, Inc., together with its subsidiaries, acquires and manages precious metal streams, royalties, and related interests. The company engages in acquiring stream and royalty interests or to finance projects that are in production, development, or in the exploration stage in exchange for stream or royalty interests, which primarily consists of gold, silver, copper, nickel, zinc, lead, and other metals. Its stream and royalty interests on properties are located in the United States, Canada, Chile, the Dominican Republic, Australia, Africa, Mexico, Botswana, and internationally. Royal Gold, Inc. was incorporated in 1981 and is headquartered in Denver, Colorado.