A Look At Alliance Resource Partners (ARLP) Valuation After Recent Price Momentum And Cash Flow Estimates

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Alliance Resource Partners (ARLP) has drawn fresh attention after recent price moves, with the unit price at $26.47 and returns ranging from a 6% decline over the past month to a 9% gain over the past 3 months.

See our latest analysis for Alliance Resource Partners.

The recent 1 day share price return of 4.01% and 7 day gain of 7.17% come after a softer 30 day share price return of 5.97%. These sit within a broader backdrop where year to date share price return is 13.65%, while 1 year total shareholder return is 10.42% and 3 year total shareholder return is 80.56%. This points to momentum that has cooled slightly in the short term compared with the longer record.

If you are weighing ARLP against other opportunities in the energy space, it can help to see which producers the market is rewarding right now through 25 elite gold producer stocks

With units at $26.47, an intrinsic value estimate implying a 67.71% discount, and analyst targets about 14.60% higher, the key question is whether ARLP is genuinely undervalued or if the market is already pricing in future growth.

Price-to-Earnings of 14x: Is it justified?

At a last close of $26.47, Alliance Resource Partners is trading on a P/E of 14x, which screens as good value compared with peers and the broader US Oil and Gas industry.

The P/E multiple compares the current unit price to earnings per unit and is a quick way to see how much investors are paying for each dollar of profit. For a producer like ARLP with exposure to coal, oil and gas royalties, and mining technology services, this lens helps you judge how the market is weighing its earnings profile against other energy names.

ARLP is flagged as good value on several fronts, including trading at 67.7% below an internal fair value estimate based on future cash flows and sitting below both the peer average P/E of 21.6x and the US Oil and Gas industry average of 14.9x. The estimated fair P/E of 22.9x also sits comfortably above the current 14x level, which is presented as a ratio the market could move toward if that assessment proves accurate.

Stacking ARLP against its peer group, the current 14x P/E looks lower than the 21.6x peer average and the 14.9x industry average. This points to a market that is pricing its earnings at a discount relative to many US Oil and Gas names while still assigning a positive multiple to its profit base. If the fair P/E of 22.9x is used as a reference point, that gap becomes even more pronounced and highlights how differently the current market price treats ARLP's earnings compared with that regression based fair ratio.

Story Continues

Explore the SWS fair ratio for Alliance Resource Partners

Result: Price-to-Earnings of 14x (UNDERVALUED)

However, you also need to weigh risks such as coal demand uncertainty and any slowdown in ARLP's $2.17b revenue or $243.30m net income performance.

Find out about the key risks to this Alliance Resource Partners narrative.

Another View: Cash Flow Says The Discount Is Deeper

While the 14x P/E suggests ARLP is on the cheaper side versus peers, the SWS DCF model presents an even starker picture, with an estimated future cash flow value of $81.97 compared with the current $26.47 unit price. That is a large implied gap, so is the market being too cautious or is the model too optimistic?

Look into how the SWS DCF model arrives at its fair value.ARLP Discounted Cash Flow as at Apr 2026

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Alliance Resource Partners for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 53 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

Given this mix of cautious and optimistic signals, it makes sense to check the full picture yourself and decide how comfortable you are with the trade off between risk and reward by reviewing the 3 key rewards and 1 important warning sign.

Looking for more investment ideas?

If ARLP is on your radar, it is worth lining it up against other opportunities too, so you are not leaving potential ideas on the table.

Target higher quality value by scanning companies that combine strong financials with appealing prices through the 53 high quality undervalued stocks. Strengthen your income shortlist by checking out companies with robust yields and defensible payouts in the 14 dividend fortresses. Prioritize resilience by reviewing companies with lower risk profiles and steadier fundamentals using the 1 resilient stocks with low risk scores.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include ARLP.

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