Hallador Energy (NASDAQ: HNRG) and Natural Resource Partners (NYSE:NRP) are both small-cap oils/energy companies, but which is the better business? We will contrast the two companies based on the strength of their earnings, institutional ownership, profitability, dividends, analyst recommendations, risk and valuation.

Dividends

Hallador Energy pays an annual dividend of $0.16 per share and has a dividend yield of 3.0%. Natural Resource Partners pays an annual dividend of $1.80 per share and has a dividend yield of 7.2%. Hallador Energy pays out 59.3% of its earnings in the form of a dividend. Natural Resource Partners pays out 54.2% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years. Natural Resource Partners is clearly the better dividend stock, given its higher yield and lower payout ratio.

Risk and Volatility

Hallador Energy has a beta of -0.61, meaning that its share price is 161% less volatile than the S&P 500. Comparatively, Natural Resource Partners has a beta of 0.65, meaning that its share price is 35% less volatile than the S&P 500.

Earnings and Valuation

This table compares Hallador Energy and Natural Resource Partners’ revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Hallador Energy $264.18 million 0.61 $71.61 million $0.27 20.07
Natural Resource Partners $319.23 million 0.96 $163.28 million $3.32 7.52

Natural Resource Partners has higher revenue and earnings than Hallador Energy. Natural Resource Partners is trading at a lower price-to-earnings ratio than Hallador Energy, indicating that it is currently the more affordable of the two stocks.

Profitability

This table compares Hallador Energy and Natural Resource Partners’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Hallador Energy 3.13% 11.19% 4.67%
Natural Resource Partners 25.25% 37.73% 4.19%

Analyst Ratings

This is a summary of recent ratings and target prices for Hallador Energy and Natural Resource Partners, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Hallador Energy 0 0 1 0 3.00
Natural Resource Partners 0 2 0 0 2.00

Hallador Energy currently has a consensus price target of $11.00, indicating a potential upside of 102.95%. Natural Resource Partners has a consensus price target of $30.50, indicating a potential upside of 22.24%. Given Hallador Energy’s stronger consensus rating and higher possible upside, equities research analysts clearly believe Hallador Energy is more favorable than Natural Resource Partners.

Institutional & Insider Ownership

55.7% of Hallador Energy shares are owned by institutional investors. Comparatively, 21.6% of Natural Resource Partners shares are owned by institutional investors. 55.7% of Hallador Energy shares are owned by insiders. Comparatively, 39.0% of Natural Resource Partners shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

Natural Resource Partners beats Hallador Energy on 9 of the 16 factors compared between the two stocks.

About Hallador Energy

Hallador Energy Company is an oil and gas exploration company focused on developing coal reserves in the Illinois Basin. The Company, through its subsidiary, Sunrise Coal, LLC, is engaged in coal mining in the state of Indiana serving the electric power generation industry. Its projects include Carlisle Mine, Ace in the Hole Mine, Oaktown 1 Mine, Oaktown 2 Mine and Bulldog Mine. It develops over 10 million tons of coal annually and has customers in the mid-west and southeastern United States. It has over 40.6 million tons of the Indiana coal V seam. It also has over 69.3 million controlled tons in both Knox County, Indiana and Lawrence County, Illinois. Its Carlisle underground coal mine is located near the town of Carlisle, Indiana in Sullivan County. The Ace mine is located approximately 40 miles northeast of the Carlisle Mine. Its Bulldog Mine controls over 35.8 million tons of coal reserves.

About Natural Resource Partners

Natural Resource Partners L.P. owns, operates, manages and leases a portfolio of mineral properties in the United States, including interests in coal, trona and soda ash, construction aggregates and other natural resources. Coal Royalty and Other segment consists primarily of coal royalty and coal related transportation and processing assets. As of December 31, 2016, Soda Ash segment included the Company’s 49% non-controlling equity interest in Ciner Wyoming, a trona ore mining operation and soda ash refinery in the Green River Basin, Wyoming. VantaCore’s operating businesses include Laurel Aggregates, located in Lake Lynn, Pennsylvania; Winn Materials/McIntosh Construction, located in Clarksville, Tennessee; Grand Rivers, located in Grand Rivers, Kentucky, and Southern Aggregates, located near Baton Rouge, Louisiana.

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