Westmoreland Coal (NASDAQ: WLB) and Alpha Appalachia Holdings (NYSE:MEE) are both oils/energy companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, institutional ownership, valuation, profitability, dividends, earnings and analyst recommendations.

Valuation & Earnings

This table compares Westmoreland Coal and Alpha Appalachia Holdings’ revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Westmoreland Coal $1.48 billion 0.02 -$27.10 million ($6.11) -0.29
Alpha Appalachia Holdings N/A N/A N/A ($2.05) N/A

Alpha Appalachia Holdings has higher revenue, but lower earnings than Westmoreland Coal. Westmoreland Coal 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 Ratings

This is a summary of current ratings and target prices for Westmoreland Coal and Alpha Appalachia Holdings, as reported by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Westmoreland Coal 0 1 2 0 2.67
Alpha Appalachia Holdings 0 0 0 0 N/A

Westmoreland Coal currently has a consensus price target of $6.00, suggesting a potential upside of 238.98%.

Profitability

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

Net Margins Return on Equity Return on Assets
Westmoreland Coal -8.06% N/A -7.61%
Alpha Appalachia Holdings N/A N/A N/A

Insider and Institutional Ownership

76.3% of Westmoreland Coal shares are owned by institutional investors. 1.4% of Westmoreland Coal shares are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock will outperform the market over the long term.

Summary

Westmoreland Coal beats Alpha Appalachia Holdings on 4 of the 7 factors compared between the two stocks.

Westmoreland Coal Company Profile

Westmoreland Coal Company is an energy company. The Company operates through six segments: Coal-U.S., Coal-Canada, Coal-(WMLP), Power, Heritage and Corporate. The Coal-U.S. segment includes the operations of coal mines located in Montana, North Dakota, Ohio, Texas and New Mexico. The Coal-Canada segment includes the operations of coal mines located in Alberta and Saskatchewan. The Coal-WMLP segment includes the operations of Westmoreland Resource Partners, LP, a coal master limited partnership. The Power segment includes its Roanoke Valley Power Facility (ROVA) operations located in North Carolina. The Heritage segment includes the benefits it provides to former mining operation employees, as well as other administrative costs associated with providing those benefits and cost containment efforts. It produces and sells thermal coal primarily to investment grade utility customers under cost-protected contracts, as well as to industrial customers and barbeque briquettes manufacturers.

Alpha Appalachia Holdings Company Profile

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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