A Look At Alliance Resource Partners (ARLP) Valuation After Noble Financial Cuts Q2 2026 Earnings Forecast

Analyst forecast cut puts Alliance Resource Partners in focus

Noble Financial recently lowered its Q2 2026 earnings forecast for Alliance Resource Partners (ARLP), trimming the expected EPS from $0.65 to $0.51, a shift that has drawn fresh investor attention.

See our latest analysis for Alliance Resource Partners.

At a share price of $28.17, Alliance Resource Partners sits on a 90 day share price return of 18.71% and a 1 year total shareholder return of 26.01%. This suggests that momentum has been building even as the earnings outlook for Q2 2026 is reassessed.

If this earnings revision has you reassessing your opportunity set, it can be a good moment to scan the market for other energy linked ideas such as 93 nuclear energy infrastructure stocks

With ARLP trading at $28.17 and an intrinsic value estimate implying a 63% discount, yet sitting only about 8% below the average analyst price target, you have to ask: is there mispricing here, or is the market already baking in future growth?

Preferred P/E of 11.8x: Is it justified?

On a P/E of 11.8x at a last close of $28.17, Alliance Resource Partners screens as undervalued compared with its own estimated fair P/E of 21.7x and with peers.

The P/E ratio compares the current share price against earnings per unit, so it gives you a quick sense of how much investors are paying for each dollar of profits. For ARLP, that 11.8x sits below the US Oil and Gas industry average of 15.6x and also below the peer average of 20.4x. This indicates the market is assigning a lower earnings multiple than both sector peers and the fair ratio estimate suggest.

Our DCF work adds another angle here, with ARLP at $28.17 versus an SWS DCF model estimate of $76.92 based on projected future cash flows discounted back to today. Taken together with the fair P/E of 21.7x, the current multiple implies the market is pricing in a more muted earnings profile than these valuation frameworks, while the company continues to report high quality earnings and 5 year annual earnings growth of 16.4%.

Compared with the US Oil and Gas industry P/E of 15.6x and the peer average of 20.4x, ARLP’s 11.8x multiple is materially lower. The fair P/E of 21.7x sets out a level the market could move towards if sentiment and expectations converged on that view.

Explore the SWS fair ratio for Alliance Resource Partners

Result: Price-to-earnings of 11.8x (UNDERVALUED)

However, your thesis can be challenged if coal demand softens faster than expected or if regulatory and environmental pressures weigh on ARLP’s US focused operations.

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

Another view: Cash flows tell a stronger story

If the P/E of 11.8x already looks appealing, the SWS DCF model goes further and suggests a fair value of $76.92 per unit versus the current $28.17 price, which implies a very wide margin. That kind of gap raises a simple question: is the risk or the opportunity bigger here?

Look into how the SWS DCF model arrives at its fair value.

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 58 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

With all this mixed sentiment around value and future earnings, it makes sense to look at the numbers yourself and decide where you stand. To balance the potential upside with the concerns already flagged by the market, take a closer look at the 3 key rewards and 1 important warning sign

Ready to hunt for more opportunities?

Do not stop with a single idea when there is a full market of possibilities waiting. Use the screeners below to quickly spot prospects that match your goals.

• Target potential mispricings by scanning screener containing 25 high quality undiscovered gems that combine strong fundamentals with less attention from the crowd.
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• Focus on financial strength by checking the solid balance sheet and fundamentals stocks screener (40 results) to see which companies pair sound balance sheets with solid fundamentals.

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.

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