Why Alpha Natural Resources, Inc.'s Shares Popped

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of Alpha Natural Resources,  (NYSE: ANR  ) jumped 15% today after selling an asset.

So what: The company is selling its 50% stake in a natural gas joint venture to Rice Energy. The deal calls for $100 million in cash for the asset and $200 million in Rice Energy common stock, which plans to go public in early 2014.  

Now what: The deal will give Alpha Natural more cash to try and turn around core coal operations, which have been in rapid decline. What this doesn't do is fundamentally change the company's investment thesis because the coal market is still very weak. I'd still stay out of this stock because I think Alpha Natural will end up burning through the money made from this sale before it sees a long-term improvement in the coal market.

One stock to buy now
What stock should you be investing in now? Watch our jaw-dropping investor alert video today to find out why The Motley Fool's chief technology officer is putting $117,238 of his own money on the table, and why he's so confident this stock will be a huge winner in 2013 and beyond. Just click here to watch!


Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2758194, ~/Articles/ArticleHandler.aspx, 12/20/2014 1:13:36 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement