Ramaco Resources' (METC) Brook Mine project in Wyoming could help it expand beyond its legacy coal business and capitalize on US efforts to boost domestic production of rare earth elements and critical minerals, Morgan Stanley said in a Friday research report.

Ramaco's legacy metallurgical coal portfolio is likely to benefit as coking coal prices find support from production suspensions in Australia and a better blast furnace outlook in India, according to the note.

The company runs four metallurgical coal mines in Appalachia, focused on high-quality coal for the steel sector, and is expected to benefit from a rebound in the seaborne market in the coming years, analysts wrote.

While the company has accelerated its transition to a new business line with the Wyoming thermal coal deposit, it must show positive results from the upcoming REE/CM plant, upgrade mineral resources in the near-term, and complete a pre-feasibility study in Q1 2026 to outline a feasible path for commercial production in late 2027, the firm stated.

The company should also secure off-take agreements with downstream partners who will purchase new plant output, Morgan Stanley added.

Morgan Stanly initiated coverage of the stock with an equalweight rating and a price target of $17.50 per share.

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