American Resources Corporation’s AREC subsidiary, American Carbon Corporation, has acquired a 51% ownership stake in a diversified mineral asset with a focus on iron ore, titanium and vanadium, with an initial estimated deposit of 212,925,000 tons of raw feedstock and 106,462,500 tons of ore body, based on an average of 50% magnetic material.

American Carbon is an owner and operator of low-cost, high-quality metallurgical and specialty carbon assets.

The company noted that it has been working for more than a year on this diverse and high-quality asset to assess the market demand and importance of high-value assets in the iron ore and titanium markets. The company believes that the completed initial reserve study and material assays have the potential to make this a world-class asset for iron ore, titanium and other key or strategic elements.

The company is excited to collaborate with its local partners as it continues to expand the reserve evaluation, mine plan, permitting and operational game plan to work with the local community in the future, utilizing low-cost, highly environmentally sensitive technologies for mineral concentration and processing.

American Carbon acquired its 51% ownership interest in TR Mining and Equipment Limited with 100% offtake rights to mineral feedstock located within the Special Exclusive Prospecting License No. 611 or any successor permit.

The total consideration for the 51% ownership stake and offtake rights is the issuance of around 6% of the equity of American Carbon to the owners of TR Mining. This equates to a total equity consideration of roughly $19.3 million.

Shares of American Resources have lost 12.7% over the past year compared with a 3.5% decline of its industry. Zacks Investment Research

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Zacks Rank & Key Picks

AREC currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the basic materials space include Cameco Corporation CCJ, Carpenter Technology Corporation CRS and Alpha Metallurgical Resources Inc. AMR.

Cameco, carrying a Zacks Rank #1 (Strong Buy), has a projected earnings growth rate of 188% for the current year. The Zacks Consensus Estimate for CCJ’s current-year earnings has been revised upward by 12.5% in the past 60 days. The stock is up around 77.1% in a year. You can see the complete list of today’s Zacks #1 Rank stocks here.

Carpenter Technology currently carries a Zacks Rank #1. CRS beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 12.2%. The company’s shares have soared 18.9% in the past year.

The Zacks Consensus Estimate for AMR’s current-year earnings has been revised upward by 69% in the past 60 days. It currently carries a Zacks Rank #1.  AMR delivered a trailing four-quarter earnings surprise of roughly 9.6%, on average. AMR shares are up around 137.8% in a year.



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