Value
7.6/10data confidence 67%| Component | Sub-score |
|---|---|
| P/S | 9.2 |
| Fwd P/E | 1.3 |
| PEG | 9.2 |
| Analyst target | 9.0 |
- ▸Forward P/E: 73.0x
- ▸PEG: 0.63
- ▸Attractively valued
METC · Why this verdict
Why Ramaco Resources (METC) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score4.3/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Short interest stands at 49% of float — an extremely elevated level reflecting broad institutional conviction that the stock will decline further — while implied volatility of 139% prices in high uncertainty about future value. Risk breakdown | If the bear thesis holds, short interest stays above 30% and price continues trending below the 200-day moving average over the next 12 months. | →Stable |
| CounterA 49% short position is a mechanical source of potential upside; any positive catalyst could force a rapid short-covering event that produces an outsized price move independent of fundamental improvement. | ||
Price momentum scores 1.6 — well below the minimum threshold — with a 200-day moving average falling at -5.0% per 30 days, a death-cross pattern in force, and volume distribution (falling OBV), confirming a sustained downtrend with no technical signal of near-term reversal. Momentum breakdown | If the downtrend persists, price stays below the 200-day moving average and OBV continues declining for the next 6 months. | →Stable |
| CounterThe RSI reading near 49 is mid-range rather than deeply oversold, suggesting the stock is not yet at an exhaustion level that often precedes tactical bounces even within a broader downtrend. | ||
Business quality scores 1.5 out of 10 — the lowest tier — with a Piotroski F-Score of only 3 out of 9, no identifiable competitive moat, and free cash flow consuming 19% of revenue, indicating the business is burning cash at the operating level while generating weak returns. Quality breakdown | If deterioration continues, free cash flow remains negative as a share of revenue and the Piotroski score stays below 5 over the next 12 months. | →Stable |
| CounterThe value score of 7.4 and a PEG of 0.71 suggest that if the operational environment improves, the assets may be priced very cheaply relative to earnings potential, creating an asymmetric opportunity for a turnaround. | ||
Revenue has declined 10% year-over-year while three of the last four earnings quarters missed consensus estimates — including recent misses of -51% and -20% — pointing to a business whose financial trajectory is moving in the wrong direction with limited near-term visibility. Earnings | Revenue growth turns positive above 0% year-over-year and EPS surprise rises above 0% for 2 consecutive quarters, signaling genuine stabilization. | →Stable |
| CounterThe one beat in the series registered a 16% positive surprise, showing the business can occasionally exceed expectations when conditions allow; an improvement in the coking coal operating environment could shift the trajectory. | ||
Short interest stands at 49% of float — an extremely elevated level reflecting broad institutional conviction that the stock will decline further — while implied volatility of 139% prices in high uncertainty about future value.
→StableRisk breakdown
- Expectation
- If the bear thesis holds, short interest stays above 30% and price continues trending below the 200-day moving average over the next 12 months.
CounterA 49% short position is a mechanical source of potential upside; any positive catalyst could force a rapid short-covering event that produces an outsized price move independent of fundamental improvement.
Price momentum scores 1.6 — well below the minimum threshold — with a 200-day moving average falling at -5.0% per 30 days, a death-cross pattern in force, and volume distribution (falling OBV), confirming a sustained downtrend with no technical signal of near-term reversal.
→StableMomentum breakdown
- Expectation
- If the downtrend persists, price stays below the 200-day moving average and OBV continues declining for the next 6 months.
CounterThe RSI reading near 49 is mid-range rather than deeply oversold, suggesting the stock is not yet at an exhaustion level that often precedes tactical bounces even within a broader downtrend.
Business quality scores 1.5 out of 10 — the lowest tier — with a Piotroski F-Score of only 3 out of 9, no identifiable competitive moat, and free cash flow consuming 19% of revenue, indicating the business is burning cash at the operating level while generating weak returns.
→StableQuality breakdown
- Expectation
- If deterioration continues, free cash flow remains negative as a share of revenue and the Piotroski score stays below 5 over the next 12 months.
CounterThe value score of 7.4 and a PEG of 0.71 suggest that if the operational environment improves, the assets may be priced very cheaply relative to earnings potential, creating an asymmetric opportunity for a turnaround.
Revenue has declined 10% year-over-year while three of the last four earnings quarters missed consensus estimates — including recent misses of -51% and -20% — pointing to a business whose financial trajectory is moving in the wrong direction with limited near-term visibility.
→StableEarnings
- Expectation
- Revenue growth turns positive above 0% year-over-year and EPS surprise rises above 0% for 2 consecutive quarters, signaling genuine stabilization.
CounterThe one beat in the series registered a 16% positive surprise, showing the business can occasionally exceed expectations when conditions allow; an improvement in the coking coal operating environment could shift the trajectory.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Ramaco Resources sits below the minimum investable market capitalization and scores at the lowest quality tier — with a Piotroski F-Score of 3 out of 9, cash burning at 19% of revenue, and three of four recent earnings quarters missing estimates — while a 49% short interest and confirmed price downtrend compound the fundamental concerns.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
1.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 0.0 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 8.1 |
| FCF quality | 0.0 |
| Moat | 2.5 |
| Piotroski F | 3.3 |
- ▸Cash-burning: FCF -19% of revenue
- ▸No competitive moat
- ▸Weak Piotroski F-Score: 3/9
- ▸Quality concerns
Growth
5.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 0.1 |
| EPS growth | 10.0 |
- ▸Declining revenue: -10%
Momentum
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 1.9 |
| OBV | 10.0 |
| MA position | 1.0 |
| Volume | 0.9 |
- ▸Capitulation risk (RSI 26, below 200MA)
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -6.8%/30d — confirmed downtrend
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 10.0 |
| erm sentiment | 5.0 |
- ▸Analyst upside: 119%
Insider
4.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| holder change | 5.0 |
- ▸Notable insider selling — $2,958,000 (0.350% of mkt cap)
Peer rank
1.8/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.0 |
| quality rank | 0.0 |
| growth rank | 0.0 |
Technical
5.8/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 8.1 |
| support resistance | 9.2 |
| 52w position | 0.0 |
Risk (lower is worse)
3.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 0.0 |
| days to cover | 2.3 |
| volatility | 0.0 |
| put call | 7.5 |
| implied vol | 0.0 |
| beta | 6.0 |
| debt equity | 4.9 |
- ▸High short interest justified: 52%
- ▸High IV: 106%
- ▸Concentration risks: 3 HIGH, 1 MED (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
2.8/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
| dividend safety | 4.2 |
- ▸Earnings concerns: 1B/3M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (6)
- ASYMMETRY:6.0>=1.5
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:25d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (3)
- MOMENTUM:3.4<4.5
- INSIDER:0.35%=HEAVY
- DEATH_CROSS:HARD_BLOCK
Warning (0)
none
Reward-to-Risk
6.04
Upside
+90.6%
Downside
15.0%
Sizing output
AVOID
SetupFalling Knife — Death cross, below all MAs, RSI 26, MACD bearish
EdgeInst Constrain — Small cap ($0.8B) below institutional reach
SuitabilitySpeculative — Drawdown -78% (>40% off 52w high)
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 7.6 could not lift the engine output above the verdict floor. Failed gate signal: MOMENTUM:3.4<4.5.
The strongest dimensions are Value at 7.6, Sentiment at 6.6, and Technical at 5.8; the weakest are Quality at 1.5, Peer rank at 1.8, and Catalyst at 2.8. The V9 engine flagged 3 failed gates, producing an asymmetric reward-to-risk of 6.04 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Sub Floor Quality Cash Burn
Trip ifFree cash flow turns positive and FCF as a percentage of revenue rises above 5% for 2 consecutive quarters.
- P2Revenue Contraction Earnings Misses
Trip ifRevenue growth exceeds 0% YoY and EPS surprise rises above 0% for 2 consecutive quarters.
- P3Extreme Short Interest Pressure
Trip ifShort interest falls below 20% of float for 4 consecutive weeks.
- P4Confirmed Technical Downtrend
Trip ifPrice breaks above the 200-day moving average and momentum score rises above 4.5.