By Darrell McKinsey

March 25, 2019 - Westmoreland Resource Partners (OTCMKTS:WMLPQ) and Cloud Peak Energy (NYSE:CLD) are both small-cap oils/energy companies, but which is the superior investment? We will contrast the two companies based on the strength of their profitability, analyst recommendations, earnings, institutional ownership, dividends, valuation and risk.

Institutional and Insider Ownership

77.9% of Cloud Peak Energy shares are owned by institutional investors. 2.0% of Westmoreland Resource Partners shares are owned by insiders. Comparatively, 3.2% of Cloud Peak Energy shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Volatility and Risk

Westmoreland Resource Partners has a beta of 1.77, suggesting that its share price is 77% more volatile than the S&P 500. Comparatively, Cloud Peak Energy has a beta of 2.66, suggesting that its share price is 166% more volatile than the S&P 500.

Profitability

This table compares Westmoreland Resource Partners and Cloud Peak Energy’s net margins, return on equity and return on assets.

Analyst Ratings

This is a summary of recent ratings and price targets for Westmoreland Resource Partners and Cloud Peak Energy, as provided by MarketBeat.com.

Cloud Peak Energy has a consensus target price of $2.75, suggesting a potential upside of 1,374.53%. Given Cloud Peak Energy’s higher possible upside, analysts plainly believe Cloud Peak Energy is more favorable than Westmoreland Resource Partners.

Earnings and Valuation

This table compares Westmoreland Resource Partners and Cloud Peak Energy’s gross revenue, earnings per share and valuation.

Cloud Peak Energy has higher revenue and earnings than Westmoreland Resource Partners.

Summary

Cloud Peak Energy beats Westmoreland Resource Partners on 8 of the 10 factors compared between the two stocks.

About Westmoreland Resource Partners

Westmoreland Resource Partners, LP, together with its subsidiaries, produces and markets thermal coal in the United States. The company also produces surface mined coal. It operates 1 surface mine in Wyoming; and 4 active mining complexes in Ohio comprising 13 surface mines. The company markets its coal to electric utilities with coal-fired power plants under coal sales contracts; and electric cooperatives, municipalities, and industrial customers in Wyoming, Kentucky, Michigan, Ohio, and West Virginia. Westmoreland Resources GP, LLC operates as the general partner of the company. The company was formerly known as Oxford Resource Partners, LP and changed its name to Westmoreland Resource Partners, LP in January 2015. The company was founded in 1985 and is based in Englewood, Colorado. Westmoreland Resource Partners, LP is a subsidiary of Westmoreland Coal Company. On October 9, 2018, Westmoreland Resource Partners, LP filed a voluntary petition for reorganization under Chapter 11 in the U.S. Bankruptcy Court for the Southern District of Texas. It is in joint administration with Westmoreland Coal Company.

About Cloud Peak Energy

Cloud Peak Energy Inc. produces coal in the Powder River Basin and the United States. The company operates through Owned and Operated Mines, and Logistics and Related Activities. It owns and operates three surface coal mines comprising the Antelope Mine and the Cordero Rojo Mine located in Wyoming; and the Spring Creek Mine located in Montana. These mines produce subbituminous thermal coal with low sulfur content. The company sells its coal primarily to domestic and foreign electric utilities. As of December 31, 2017, it controlled approximately 1.0 billion tons of proven and probable reserves. The company also has two development projects comprising the Youngs Creek project, an undeveloped surface mine project located in Wyoming; and the Big Metal project located in southeast Montana. In addition, it offers logistics and related services, including the purchase of coal from third parties, as well as the contracting and coordination of the transportation and other handling services from third-party operators. Cloud Peak Energy Inc. was founded in 1993 and is headquartered in Gillette, Wyoming.