Critical Review: NACCO Industries (NC) & Its Competitors

NACCO Industries (NYSE: NC) is one of 33 public companies in the “Coal” industry, but how does it weigh in compared to its peers? We will compare NACCO Industries to related businesses based on the strength of its risk, institutional ownership, valuation, analyst recommendations, earnings, profitability and dividends.

Institutional and Insider Ownership

48.3% of NACCO Industries shares are owned by institutional investors. Comparatively, 42.8% of shares of all “Coal” companies are owned by institutional investors. 30.6% of NACCO Industries shares are owned by company insiders. Comparatively, 22.2% of shares of all “Coal” companies are owned by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.

Valuation and Earnings

This table compares NACCO Industries and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
NACCO Industries $856.44 million $29.60 million 6.80
NACCO Industries Competitors $934.53 million -$31.41 million 186.41

NACCO Industries’ peers have higher revenue, but lower earnings than NACCO Industries. NACCO Industries is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Profitability

This table compares NACCO Industries and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
NACCO Industries 6.75% 18.54% 7.13%
NACCO Industries Competitors -228.44% 6.50% 2.44%

Volatility and Risk

NACCO Industries has a beta of 0.38, suggesting that its share price is 62% less volatile than the S&P 500. Comparatively, NACCO Industries’ peers have a beta of 0.84, suggesting that their average share price is 16% less volatile than the S&P 500.

Analyst Ratings

This is a breakdown of current ratings and target prices for NACCO Industries and its peers, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
NACCO Industries 0 0 0 0 N/A
NACCO Industries Competitors 214 665 1055 22 2.45

As a group, “Coal” companies have a potential upside of 18.09%. Given NACCO Industries’ peers higher possible upside, analysts plainly believe NACCO Industries has less favorable growth aspects than its peers.

Dividends

NACCO Industries pays an annual dividend of $1.98 per share and has a dividend yield of 4.5%. NACCO Industries pays out 30.6% of its earnings in the form of a dividend. As a group, “Coal” companies pay a dividend yield of 6.7% and pay out 83.0% of their earnings in the form of a dividend.

Summary

NACCO Industries beats its peers on 7 of the 12 factors compared.

About NACCO Industries

NACCO Industries, Inc. is a holding company. The Company’s principal business includes mining. The Company operates through the NACoal segment. The Company’s subsidiary includes The North American Coal Corporation (NACoal). The Company’s NACoal segment mines coal for use in power generation and provides mining services for other natural resources companies. Coal is surface mined from NACoal’s mines in North Dakota, Texas, Mississippi, Louisiana and the Navajo Nation in New Mexico. NACoal’s operating coal mining subsidiaries include Bisti Fuels Company, LLC (Bisti), Caddo Creek Resources Company, LLC (Caddo Creek), Camino Real Fuels, LLC (Camino Real), The Coteau Properties Company (Coteau), Coyote Creek Mining Company, LLC (Coyote Creek), Demery Resources Company, LLC (Demery), The Falkirk Mining Company (Falkirk), Liberty Fuels Company, LLC (Liberty), Mississippi Lignite Mining Company (MLMC) and The Sabine Mining Company (Sabine).

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