Assessing Ramaco Resources (METC) Valuation As Brook Mine Rare Earth Opportunity Emerges Beyond Coal

Ramaco Resources (METC) is in focus after a class action lawsuit filing, just as its Brook Mine rare earth plans introduce a potential new earnings stream alongside its metallurgical coal operations.

See our latest analysis for Ramaco Resources.

Ramaco Resources’ share price has pulled back recently, with a 30 day share price return of 10.55% and a 90 day share price return of 26.64%, even as the 1 year total shareholder return sits at 94.05% and the 5 year total shareholder return is very large at roughly 7x. This suggests earlier optimism around its metallurgical coal business and rare earth ambitions has cooled in the short term, as legal risks and project execution questions come into sharper focus.

If the Brook Mine rare earth story has caught your attention, it could be worth seeing what else is out there in this niche by checking our screener of 29 best rare earth metal stocks.

With Ramaco trading at $18.23, a value score of 1, and management highlighting potential rare earth EBITDA of over $500 million a year from around 2028, is this a mispriced growth story, or is the market already pricing in that potential future?

Most Popular Narrative: 53.4% Undervalued

At $18.23 versus a most followed fair value estimate of $39.14, the current price sits well below where this narrative anchors Ramaco Resources.

Ramaco’s advancement of the Brook Mine into America’s first new rare earth mine in over 70 years, supported by extensive federal government collaboration and potential policy support amid rising U.S. demand for domestic critical minerals, positions the company to unlock new, high margin revenue streams beyond metallurgical coal, with initial commercial oxide production targeted as soon as 2027.

Read the complete narrative.

Curious what has to happen for that rare earth ramp up to justify a fair value above $30? Revenue, margins, earnings, and a punchy future multiple all sit at the core of this story. Want to see how those ingredients are stitched together to get from losses today to the valuation implied in this narrative?

Result: Fair Value of $39.14 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, there is still meaningful risk here, including the possibility that policy support for rare earths may fall short and that Brook Mine costs, timelines or pricing may not match current expectations.

Find out about the key risks to this Ramaco Resources narrative.

Another View on Valuation

There is a twist when you compare the narrative fair value of $39.14 with our DCF model, which points to a future cash flow value of $8.84. Instead of a large discount, that framework suggests Ramaco is trading well above its cash flow estimate. So which story do you trust more?

Look into how the SWS DCF model arrives at its fair value.

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Ramaco Resources for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 52 high quality undervalued stocks. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.

Build Your Own Ramaco Resources Narrative

If you are not convinced by these views or simply want to stress test the assumptions yourself, you can build a fresh narrative in just a few minutes and Do it your way.

A great starting point for your Ramaco Resources research is our analysis highlighting 1 key reward and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If Ramaco has sparked your curiosity, do not stop here. Use this momentum to scan a wider set of opportunities and sharpen your watchlist today.

This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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