CONSOL Energy (NYSE: CNX) and Alpha Appalachia Holdings (NYSE:MEE) are both coal – nec companies, but which is the better stock? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, profitability, analyst recommendations and institutional ownership.

Profitability

This table compares CONSOL Energy and Alpha Appalachia Holdings’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CONSOL Energy -7.49% 1.09% 0.48%
Alpha Appalachia Holdings N/A N/A N/A

Earnings and Valuation

This table compares CONSOL Energy and Alpha Appalachia Holdings’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
CONSOL Energy $2.03 billion 1.81 -$848.10 million ($0.97) -16.43
Alpha Appalachia Holdings N/A N/A N/A ($2.05) -0.39

Alpha Appalachia Holdings has higher revenue, but lower earnings than CONSOL Energy. CONSOL Energy is trading at a lower price-to-earnings ratio than Alpha Appalachia Holdings, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for CONSOL Energy and Alpha Appalachia Holdings, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CONSOL Energy 0 5 4 0 2.44
Alpha Appalachia Holdings 0 0 0 0 N/A

CONSOL Energy presently has a consensus price target of $20.89, indicating a potential upside of 31.05%. Given CONSOL Energy’s higher possible upside, analysts clearly believe CONSOL Energy is more favorable than Alpha Appalachia Holdings.

Institutional & Insider Ownership

99.8% of CONSOL Energy shares are held by institutional investors. 1.5% of CONSOL Energy shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Summary

CONSOL Energy beats Alpha Appalachia Holdings on 8 of the 9 factors compared between the two stocks.

About CONSOL Energy

CONSOL Energy Inc. (CONSOL Energy) is an integrated energy company. The Company’s divisions include Exploration and Production (E&P), Pennsylvania (PA) Mining Operations and Other. The E&P division operates through four segments: Marcellus Shale, Utica Shale, Coalbed Methane (CBM) and Other Gas, which produce pipeline quality natural gas for sale primarily to gas wholesalers. Its E&P division focuses on Appalachian area natural gas and liquids activities, including production, gathering, processing and acquisition of natural gas properties in the Appalachian Basin. The Other Gas segment is primarily related to shallow oil and gas production and the Chattanooga Shale in Tennessee. The principal activities of the PA Mining Operations division are mining, preparation and marketing of thermal coal, sold primarily to power generators. The Other division includes business activities, such as coal terminal operations and water operations.

About Alpha Appalachia Holdings

Massey Energy Company (Massey) is a coal producer in the United States. The Company produces, processes and sells bituminous coal of various steam and metallurgical grades, primarily of a low sulfur content, through its 25 processing and shipping centers (Resource Groups), many of which receive coal from multiple mines. At January 31, 2011, the Company operated 84 mines, including 66 underground mines (one of which employs both room and pillar and longwall mining) and 18 surface mines (with 12 highwall miners in operation) in West Virginia, Kentucky and Virginia. On April 19, 2010, the Company completed the acquisition of Cumberland Resources Corporation and certain affiliated entities (Cumberland). The Cumberland operations include primarily underground coal mines in Southwestern Virginia and Eastern Kentucky. The Company owns a majority interest in Coalsolv, LLC (Coalsolv).

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