Coal Stocks Still Have an Uphill Battle

Coal stocks have been bludgeoned again this week, after President Obama gave little indication he was going to give the industry leeway in new environmental regulations. Arch Coal (NYSE: ACI  ) , Alpha Natural Resources (NYSE: ANR  ) , and Peabody Energy (NYSE: BTU  ) are all facing long-term challenges finding demand for thermal coal, and they're not dissipating any time soon. In the following video, Fool contributor Travis Hoium covers why he thinks coal stocks are a bad buy. 

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  • Report this Comment On June 29, 2013, at 6:16 PM, thethirdchimp wrote:

    The only comment I might challenge regards the claim that natural gas prices will not rise much any time soon. I guess the problem is the vagueness of any time soon. Right now there is a manufacturing renaissance happening in U.S. due, in large part, to cheap natural gas. For instance, Dow Chemical is investing billions in new production facilities and many firms are following suit to exploit cheap NG which is feedstock for many chemicals and plastics, as well as fertilizers. By next year, liquefied natural gas and export facilities begin to come on line. Given that Asia and elsewhere pays at least 3 times more for NG than U.S., I expect exports to be robust. NG prices should rise and possibly quite substantially within a year or two. Moreover, as the supply and demand coal imbalance rationalizes, those coal miners left standing could do very well as the pendulum shifts in favor to coal sellers, which invariably happens. Mines can shut down quickly but it takes years to start one up. The Panama canal widening will be complete next year , permitting larger capacity for coal carriers, even if terminals don't get built in NW USA, which still could happen. If you have patience, now is the time to begin accumulating those coal companies w/ the strongest balance sheets and asset bases, e.g., BTU, ANR and ACI.

  • Report this Comment On June 29, 2013, at 8:07 PM, Johnjaywi wrote:

    Obama is all about killing jobs!!

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