Alliance Resource Partners, L.P.: Alliance Resource Partners, L.P.
Company Overview
- Ticker: ARLP (NASDAQ)
- Headquarters: Tulsa, Oklahoma, USA
- Founded: 1971
- CEO: Joseph W. Craft
- Industry: Coal Mining & Energy Materials
Core Business
Alliance Resource Partners is a diversified energy partnership focused primarily on thermal coal mining, selling to electric generation and industrial customers, with operations concentrated in the Illinois Basin.
- Coal Production & Sales: Produces and markets thermal coal for power generation and industrial users. Thermal coal remains a key fuel for baseload generation, particularly in the U.S. Midwest.
- Mining Operations: Operates several long-lived underground mines in the Illinois Basin under long-term contracts and spot sales.
- Logistics & Transportation: Strong logistical footprint with rail and barge access, enabling delivery flexibility and cost management.
- Contract Portfolio: Mix of long-term and spot contracts with utilities and industrial customers provides revenue visibility with upside exposure to spot pricing.
- Asset Base: Low-cost reserves with deep coal seams and historically solid margins relative to global peers.
Industry Overview
The coal industry is structurally challenged in many regions due to environmental policy, fuel substitution (gas/renewables), and investor sentiment shifting away from fossil fuels. However, in certain U.S. regions, thermal coal remains economically competitive as a baseload power source, especially where natural gas prices are elevated.
The market is also impacted by global export dynamics, currency effects, and regulatory pressures on emissions.
Environmental regulation and carbon costs pressure long-term outlooks, though recent policy shifts have slowed outright retirements in some regions.
Key Growth Drivers
- Domestic Thermal Coal Demand: U.S. utilities continue to burn coal for baseload generation, particularly when gas prices are high, supporting demand for Illinois Basin coal.
- Contract Pages & Volume Commitments: Long-term contracts with utilities provide cash flow stability. Cost Discipline & Operational Efficiency: Focus on maintaining low mining and logistics costs through scale, proven reserves, and efficient operations.
- Spot Pricing Exposure: Exposure to spot coal prices allows upside when demand and pricing strengthen, particularly in utility procurement cycles.
- Free Cash Flow Potential: Coal miners generate strong free cash flows in tight supply environments, which support balance sheet strength and distributions.
Dividend Profile
- Dividend Yield: 9.50%
- Payout Ratio: 107.28%
- Dividend Paid: $2.50
- Dividend Growth: 5 consecutive years of dividend increase.
- Sustainability: Well-covered dividend supported by free cash flow.
Financial Overview
- Revenue: $2.195 billion
- Net Income: 311.16 million
- Operating Income: $385.30 million
- Total Assets: $2.85 billion
- Total Debt: $465.38 million
- P/E Ratio (Current): 10.47
Key Financials
Risks
Target
Right now, the company is trading at US $25.61, with a 1-year projected target of around US $30.50 and a low estimation of US $23; the average price target will be US $28.
MarketFacts gives a “Buy” rating on the stock at the closing price of US $25.61 as of February 17th, 2026.
Disclaimer:
The information provided in this document and the resources available for download are intended for informational purposes only and should not be interpreted as financial advice. While the content is based on thorough research and is accurate to the best of our knowledge, it is not a substitute for professional financial guidance. We strongly recommend consulting with a financial advisor to discuss your specific situation and obtain tailored advice before making any financial decisions.
