Alliance Resource Partners (ARLP) $25.54
Market Cap: $3.28 billion – EPValue: $3.7 billion – P/E (fwd) 9.6 – Dividend 10.9%
Shares Outstanding 128 million – Insider ownership 30%
3-year chart sourced from StockCharts
Website Link … Stats and News link at Finviz
About ARLP:
ARLP is an active coal mining company who also leases oil a& gas properties for royality revenue.
Alliance Resource Partners, L.P. (ARLP) has entered the Bitcoin ecosystem, according to Bitcoin Treasuries Net. However, ARLP does not directly purchase Bitcoin. Instead, they focus on mining Bitcoin using their existing excess electricity capacity. ARLP has been mining Bitcoin since 2020.
ARLP uses underutilized electricity at their River View Kentucky facilities to power Bitcoin mining operations, says The Block. During an April earnings call, ARLP’s CFO, Cary Marshall, stated they are “not actually out there buying Bitcoin or anything of that nature,” but instead “mining the Bitcoin associated with these miners that we have”.
This strategy allows Alliance Resource Partners to benefit from growing interest in Bitcoin and capitalize on digital assets, according to Bitcoin Treasuries Net. They also rent extra data processing capacity to other Bitcoin miners, utilizing low energy costs, notes Yahoo Finance.
As of March 31, 2025, ARLP held 513 Bitcoin, valued at $42.3 million. They view Bitcoin as a strategic asset, seeing it as a potential hedge against inflation and a way to mitigate risks, according to Bitcoin Treasuries Net. This approach of using operational resources for mining differentiates ARLP from companies focused on purchasing Bitcoin.
ARLP is not a growth investment. It is a dividend investment whose revenue will rise and fall with the price of Oil, Gas and Coal.
They are not aggressive in owning Bitcoin but ownership of Bitcoin doe provide a hedge against the potential of deplettion of their producing coal, oil & gas. An important factor in their Bitcoin mining is that they own the source of electricity. Electricity is the highest cost factor in the production of Bitcoin. Ownership of the source of electricty contributes to the low cost of electricity for mining purposes. The potential of being able to convert their Bitcoin mining operations to a AI Data Center is a plus.
We like the 30% insider ownership. We also like buying companies whose dividend yield number is greater then their P/E number.
Demand for energy in an electrified and robotic world will continue to expand.
Pros & Cons of the above statement – from an investment perspective, opportunities are in the Cons sector (Link)
The biggest negative for ARLP might be the fact that they are a Master Limited Partnership that will require more work at Tax Time.
Additional Info sourced from the web:
Alliance Resource Partners L.P. (ARLP) has found a unique way to utilize the underutilized electricity generated at their River View coal mine in Kentucky. They have transformed some of the mine’s electric galleries into data centers for Bitcoin mining operations.
Here’s how they are using the underutilized electricity:
- Bitcoin Mining: ARLP uses its surplus electricity as fuel for bitcoin mining, turning what would have been wasted energy into a profitable operation.
- Hosting Services: They also host bitcoin mining platforms for third parties, further maximizing their returns and diversifying their business.
- Company-Owned Rigs: ARLP operates around 3,500 of their own bitcoin mining rigs at the River View facility.
- Monetizing Surplus: The partnership began mining bitcoin in 2020 specifically to monetize already paid-for but underutilized electricity at the River View mine.
This strategy allows ARLP to leverage existing infrastructure at the River View complex and generate income from their surplus electricity. This demonstrates an innovative approach to utilize resources beyond coal production, particularly in response to the growing demand for affordable energy in the context of bitcoin mining.
Operating companies that hold bitcoin is the “new” business model. Bitcoin is rapidly becoming the core store of value at the corporate level.
Sourced from eTrade produced bt TipRanks
Bitcoin as your benchmark hurdle rate:
Bitcoin as your store of value and base performance level: If you cant out perform bitcoin – just by Bitcoin. Hint very few investments are out performing Bitcoin.
The New Benchmark: In the last 13 years, the Bitcoin index (in USD) had a compound annual growth rate of 99.25%.
STATEMENT OF OPINION:
- In the not too distant future, all investment values and returns will be measured in Bitcoin – not the US Dollar.
- Corporations and individuals have started to gravitate to this new financial system.
- It is better to be early than late in transitioning to this new financial system.
- It is still early in the transition period.
- ARLP is an example of a company that is not changing their core focus but is incorporating Bitcoin into their business structure.
No account related to LOTM has a position in ARLP at this time.
This report is dated June 30, 2025.
