American Resources Corp. (Indiana)
Find Ratings ReportsAMERICAN RES CORP's gross profit margin for the first quarter of its fiscal year 2019 has significantly decreased when compared to the same period a year ago. Sales and net income have dropped, although the growth in revenues underperformed the average competitor within the industry, the net income growth did not. AMERICAN RES CORP has very weak liquidity. Currently, the Quick Ratio is 0.04 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity decreased from the same period a year ago, despite already having very weak liquidity to begin with. This would indicate deteriorating cash flow.
At the same time, stockholders' equity ("net worth") has greatly increased by 131.37% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.
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| Income Statement | Q1 FY19 | Q1 FY18 |
|---|---|---|
| Net Sales ($mil) | 6.99 | 7.33 |
| EBITDA ($mil) | -8.22 | -1.54 |
| EBIT ($mil) | -9.89 | -2.49 |
| Net Income ($mil) | -10.07 | -2.7 |
| Balance Sheet | Q1 FY19 | Q1 FY18 |
|---|---|---|
| Cash & Equiv. ($mil) | 0.0 | 0.01 |
| Total Assets ($mil) | 65.57 | 18.5 |
| Total Debt ($mil) | 24.86 | 16.07 |
| Equity ($mil) | 13.56 | -43.23 |
| Profitability | Q1 FY19 | Q1 FY18 |
|---|---|---|
| Gross Profit Margin | -35.87 | -10.7 |
| EBITDA Margin | -117.45 | -20.96 |
| Operating Margin | -141.42 | -34.03 |
| Sales Turnover | 0.48 | 1.16 |
| Return on Assets | -30.92 | -75.69 |
| Return on Equity | -149.81 | 0.0 |
| Debt | Q1 FY19 | Q1 FY18 |
|---|---|---|
| Current Ratio | 0.08 | 0.08 |
| Debt/Capital | 0.65 | -0.59 |
| Interest Expense | 0.46 | 0.25 |
| Interest Coverage | -21.55 | -10.09 |
| Share Data | Q1 FY19 | Q1 FY18 |
|---|---|---|
| Shares outstanding (mil) | 23.32 | 0.89 |
| Div / share | 0.0 | 0.0 |
| EPS | -0.48 | -2.96 |
| Book value / share | 0.58 | -48.47 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 26761.0 | 12426.0 |
SELL. This stock’s P/E ratio is negative, making its value useless in the assessment of premium or discount valuation, only displaying that the company has negative earnings per share. For additional comparison, its price-to-book ratio of 5.54 indicates a significant premium versus the S&P 500 average of 3.35 and a significant premium versus the industry average of 1.91. The price-to-sales ratio is above the S&P 500 average and well above the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, AMERICAN RES CORP seems to be trading at a premium to investment alternatives.
| Price/Earnings |
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Price/Cash Flow |
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|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| AREC NM | Peers 16.01 | AREC 4.29 | Peers 7.27 | |||||||||||||||||||||
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Neutral. The absence of a valid P/E ratio happens when a stock can not be valued on the basis of a negative stream of earnings. AREC's P/E is negative making this valuation measure meaningless. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. AREC is trading at a significant discount to its peers. |
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| Price/Projected Earnings |
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Price to Earnings/Growth |
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| AREC NA | Peers 14.61 | AREC NA | Peers 0.63 | |||||||||||||||||||||
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Neutral. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth potential. Ratio not available. |
Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. Ratio not available. |
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| Price/Book |
|
Earnings Growth |
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| AREC 5.54 | Peers 1.91 | AREC 31.32 | Peers 275.54 | |||||||||||||||||||||
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Premium. A higher price-to-book ratio makes a stock less attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. AREC is trading at a significant premium to its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, AREC is expected to significantly trail its peers on the basis of its earnings growth rate. |
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| Price/Sales |
|
Sales Growth |
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| AREC 2.41 | Peers 1.81 | AREC 44.85 | Peers 17.68 | |||||||||||||||||||||
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Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. AREC is trading at a significant premium to its industry. |
Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share. AREC has a sales growth rate that significantly exceeds its peers. |
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