We came across a bullish thesis on Alpha Metallurgical Resources, Inc. on Unfair Advantage’s Substack by AK. In this article, we will summarize the bulls’ thesis on AMR. Alpha Metallurgical Resources, Inc.'s share was trading at $221.06 as of January 29th. AMR’s trailing P/E was 6.24 according to Yahoo Finance. USA Rare Earth (USAR) Climbs 13.9% on Bullish Outlook Copyright: vyacheslavsvetlichnyy / 123RF Stock Photo Alpha Metallurgical Resources (AMR) is the largest metallurgical coal producer in the U. ...

Financial Performance - Alpha reported a preliminary net loss of $17.3 million, or $1.34 per diluted share, for Q4 2025[5]. - Adjusted EBITDA for the fourth quarter was $28.5 million, excluding approximately $6 million in non-recurring costs due to mine recovery issues[6][3]. - Total coal revenues for the fourth quarter reached $519.1 million, with non-GAAP coal revenues of $436.3 million after excluding freight and handling[7][27]. - The company sold 3.8 million tons of coal in Q4 2025, with a realized pricing of $115.31 per ton[8][9]. - The cost of coal sales for the Met segment was $478.5 million, resulting in a non-GAAP cost of coal sales of $383.8 million, or $101.43 per ton[12][27]. - Alpha's coal margin for the Met segment was reported at $52.5 million, or $13.87 per ton, indicating a positive non-GAAP coal margin despite a GAAP coal margin loss[27]. Liquidity and Shareholder Actions - As of December 31, 2025, Alpha had total liquidity of $524.3 million, including cash and cash equivalents of $366.0 million[13]. - The board authorized a share repurchase program of up to $1.5 billion, with approximately $1.1 billion spent to acquire 6.9 million shares to date[14][15]. Future Announcements - The company plans to announce definitive Q4 2025 financial results on February 27, 2026, and will hold a conference call on the same day[18]. Revenue Breakdown - Total met coal segment revenues reached $415,947,000, with an average realization of $118.10 per ton sold[28]. - Export coal sales accounted for 50% of total met coal tons sold, generating $187,642,000 in revenues[28]. - Domestic coal sales contributed $116,913,000, representing 22% of total met coal tons sold[28]. - Australian indexed export coal sales generated $111,392,000, making up 28% of total met coal tons sold[28]. - Non-GAAP coal revenues totaled $436,330,000, with an average realization of $115.31 per ton[28]. - Freight and handling fulfillment revenues added $82,730,000 to total coal revenues[28]. - The company sold a total of 3,784 thousand tons of coal during the quarter[28]. - The met segment also included thermal coal sales of 262 thousand tons, generating $20,383,000 in revenues[28]. - The average realization for thermal coal was $77.80 per ton sold[28].

Core Insights - Alpha Metallurgical Resources, Inc. reported a preliminary net loss of $17.3 million, or $1.34 per diluted share, for Q4 2025, with total Adjusted EBITDA of $28.5 million [1][4][3] Financial Performance - The company sold 3.8 million tons of coal in Q4 2025, generating coal revenues of $519.1 million, with non-GAAP coal revenues of $436.3 million [5][22] - The net realized pricing for the Met segment was $115.31 per ton, with a breakdown of revenues from different pricing mechanisms: $106.13 per ton for export (other pricing mechanisms), $148.93 per ton for domestic sales, and $114.96 per ton for export (Australian indexed) [7][24] - The cost of coal sales for the Met segment was $478.5 million, with a non-GAAP cost of coal sales of $383.8 million, resulting in a non-GAAP coal margin of $52.5 million [23][22] Liquidity and Capital Resources - As of December 31, 2025, the company had total liquidity of $524.3 million, including cash and cash equivalents of $366.0 million and $183.7 million of unused availability under the asset-based revolving credit facility [9] - The company had no borrowings and $41.3 million in letters of credit outstanding under the ABL, with total long-term debt of $13.4 million [9] Share Repurchase Program - The board of directors authorized a share repurchase program of up to $1.5 billion, with approximately 6.9 million shares repurchased at a cost of about $1.1 billion since the program's inception [10][11] - In Q4 2025, the company spent approximately $20 million to repurchase roughly 113,000 shares [11] Future Outlook - The company anticipates providing more detailed information about its 2025 performance when it announces its audited financial results on February 27, 2026 [3][14]

Company Overview - Alpha Metallurgical Resources, Inc. is a leading coal producer focusing on metallurgical and thermal coal markets, leveraging a portfolio of active mines and preparation facilities to supply coal to both domestic and international customers [2] - The company operates primarily in Virginia and West Virginia, generating revenue through coal mining, processing, and sales to industrial customers and utilities [3] Recent Developments - As of January 8, 2026, Alpha Metallurgical Resources shares were priced at $230.91, reflecting a 23.2% increase over the prior year and outperforming the S&P 500 by 4.39 percentage points [3] - Crocodile Capital Partners GmbH established a new position in Alpha Metallurgical Resources by acquiring 205,119 shares valued at approximately $41.00 million, representing 24.51% of Crocodile Capital's assets under management (AUM) [5][6] Stock Performance - AMR stock has experienced a strong rally over the last six months, with shares more than doubling in value and nearing a 52-week high, trading at around $230 per share [6] - An insider, Director Kenneth S. Courtis, purchased over $6 million worth of AMR stock last month, indicating confidence in the company's prospects [7] Market Position and Outlook - Alpha Metallurgical Resources is well-positioned heading into 2026, as demand for power is expected to rise due to the growth of artificial intelligence (AI) and related data centers, alongside increasing natural gas prices which enhance the economic appeal of coal [8]

Core Insights - Alpha Metallurgical Resources, a significant U.S. coal supplier, experienced a notable insider buy from Board member Kenneth S. Courtis, who purchased 37,000 shares for approximately $6.7 million during a period of declining share prices [1][9]. Transaction Summary - The transaction involved 37,000 shares traded at a total value of about $6.7 million, with a post-transaction direct ownership of 807,537 shares valued at approximately $149.4 million [2]. - The weighted average purchase price was $180.92, aligning with the market close on December 12, 2025 [2]. Insider Activity - Mr. Courtis' purchase increased his direct holdings by 4.80%, marking the highest level of his personal stake in recent times [3]. - This transaction is more than three times his historical median purchase size of 10,621 shares over the past three years, indicating a significant increase in direct ownership [6]. Company Performance - Alpha Metallurgical Resources reported a total revenue of $2,226.36 million and a net income loss of $46.55 million for the trailing twelve months [4]. - The company's stock price as of December 12, 2025, was $180.92, reflecting a 14.57% decline over the past year [6][10]. Market Context - The insider buying occurred during a period when Alpha's shares had previously hit a 52-week low of $97.41 in June and were approaching a high of $213.96 reached in December 2024, suggesting Mr. Courtis is optimistic about the company's future despite current challenges [9]. - The company has faced a downturn, reporting a net loss of $5.5 million in the third quarter compared to a net income of $3.8 million in the prior year, with sales declining from $2.3 billion in 2024 to $1.6 billion in 2025 [10].

Core Viewpoint - Alpha Metallurgical Resources, Inc. has issued guidance expectations for 2026, indicating a focus on safe production, efficiency, cost containment, and investment in the Kingston Wildcat mine despite challenging market conditions [2][3]. Sales Volume Expectations - For 2026, Alpha expects to ship between 14.4 million and 15.4 million metallurgical tons and an additional 0.7 million to 1.1 million tons of incidental thermal coal, totaling a range of 15.1 million to 16.5 million tons for the year [3]. Cost Projections - The company anticipates its cost of coal sales to be between $95.00 and $101.00 per ton for 2026, which includes the impact of the Section 45X credit [4]. SG&A and Other Expenses - Selling, general and administrative (SG&A) costs are projected to be between $53 million and $59 million, excluding non-recurring expenses and non-cash stock compensation. Idle operations expense is expected to range from $24 million to $32 million [5]. - Net cash interest income is forecasted to be between $2 million and $6 million, while depreciation, depletion, and amortization are expected to be between $160 million and $174 million [5]. Capital Expenditures and Contributions - Alpha plans for capital expenditures between $148 million and $168 million in 2026, which includes sustaining maintenance capital and development capital for the Kingston Wildcat mine. Contributions to equity affiliates are expected to be between $35 million and $45 million [6]. Tax Rate Expectations - The company expects a cash tax rate of between 0% and 5% for 2026 [7].

Core Insights - Charlie Munger, vice chairman of Berkshire Hathaway, made a surprising investment in coal in 2023, resulting in over $50 million in paper gains [1][4]. Investment Strategy - Munger had avoided coal for six decades but decided to invest in Consol Energy and Alpha Metallurgical Resources, believing that many coal producers were undervalued, particularly those producing metallurgical coal essential for steelmaking [3][4]. - His investment in Consol Energy saw its stock double, while Alpha Metallurgical Resources also experienced significant gains by the time of Munger's death in late November 2023 [4]. Personal Context - Munger continued to engage in investment discussions with Warren Buffett, maintaining an active role despite not being involved in day-to-day operations at Berkshire Hathaway [5].

Core Insights - Charlie Munger's later years were marked by active investment decisions and new challenges rather than a quiet retirement [2][3] Investment Strategies - Munger made a significant investment in the coal industry, an area he had avoided for 60 years, resulting in over $50 million in paper gains [3][5] - He purchased shares in Consol Energy and Alpha Metallurgical Resources, both of which saw substantial stock price increases, with Consol's price doubling by the time of his passing [6][5] Real Estate Ventures - Munger collaborated with a young neighbor, Avi Mayer, to invest in real estate, leading to the establishment of Afton Properties, which now holds assets valued at approximately $3 billion [7][9] - The trio acquired nearly 10,000 low-rise apartments in Southern California, with Munger actively involved in various operational aspects [7][9] Personal Challenges and Social Engagement - Munger faced health challenges, including vision problems, but maintained a humorous outlook and engaged in social activities to combat loneliness [10] - He emphasized the importance of forming new friendships in his later years, participating in weekly breakfast meetings with business associates [10] Relationship with Warren Buffett - Munger maintained a close friendship and collaboration with Warren Buffett, communicating regularly despite challenges due to hearing issues [11][12] - Their final conversation occurred shortly before Munger's passing, highlighting the enduring bond between the two investment legends [12]

Core Insights - Charlie Munger's later years were marked by active investment decisions and new challenges, rather than a quiet retirement [2][3] - Munger made significant investments in the coal industry, an area he had avoided for 60 years, resulting in over $50 million in paper gains [5][6] - He also collaborated with a young neighbor to build a real estate empire valued at approximately $3 billion [8][9] Investment in Coal Industry - Munger's unexpected investment in coal stocks came as many investors were bearish on the sector due to declining usage [5] - He believed that global energy demand would keep coal necessary, and many producers remained profitable with undervalued stock prices [5] - In May 2023, he purchased shares of Consol Energy and later Alpha Metallurgical Resources, both of which saw significant stock price increases [6] Real Estate Ventures - Munger's real estate investment began with a mentorship of his young neighbor, Avi Mayer, who sought guidance in his career [8] - Together with Mayer and Reuven Gradon, they acquired nearly 10,000 low-rise apartments in Southern California starting around 2017 [8] - Afton Properties, the company they formed, now holds assets valued at about $3 billion, with Munger actively involved in decision-making [9] Health Challenges and Social Engagement - Munger faced significant health challenges, including vision loss, but maintained a humorous outlook and engaged socially to combat loneliness [10][11] - He adapted his lifestyle, including dietary changes, and emphasized the importance of forming new friendships in his later years [11] - Munger continued to communicate regularly with Warren Buffett, maintaining their long-standing partnership despite health issues [12][13]

Core Insights - Charlie Munger, Warren Buffett's long-time partner, made significant investments in the coal industry, an area he had previously avoided for 60 years, resulting in over $50 million in profits before his passing [2][5][6] - Munger also increased his investments in real estate, collaborating with a young neighbor to acquire nearly 10,000 garden-style apartments in Southern California, making them one of the largest low-rise apartment owners in the state [7][9] Investment in Coal Industry - Munger, who had historically overlooked coal stocks, began investing in coal companies in 2023, believing that despite a long-term decline in coal usage, the industry remains essential due to global energy demands [5][6] - He purchased shares in Consol Energy and Alpha Metallurgical Resources, with Consol's stock price doubling by the time of his death [5][6] Real Estate Investments - Munger supported a young neighbor, Avi Mayer, in real estate investments, leading to the establishment of Afton Properties, which has assets valued at approximately $3 billion [8][9] - Munger was actively involved in the business decisions of Afton Properties, emphasizing long-term financing strategies over short-term gains [8][9] Personal Insights and Legacy - Munger maintained a close relationship with Buffett, communicating regularly despite health challenges, and continued to engage in discussions about investments and life principles [5][11] - His final years were marked by a commitment to learning and sharing knowledge, providing valuable lessons for investors on aging gracefully and purposefully [11][12]