Coal Stocks Getting a Boost Today
There’s nothing like an acquisition rumor to pump some life into an otherwise moribund stock. And when the company that’s the subject of the rumor is a coal miner, the whole coal mining sector gets a push. Today’s rumor involved…
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There’s nothing like an acquisition rumor to pump some life into an otherwise moribund stock. And when the company that’s the subject of the rumor is a coal miner, the whole coal mining sector gets a push.
Today’s rumor involved a potential acquisition of Walter Energy Inc. (NYSE: WLT) by BHP Billiton plc (NYSE: BHP), the world’s largest natural resources company. Walter owns significant reserves of metallurgical coal, the kind used in steelmaking that sells for a substantial premium to thermal coal used in power generation.
This wouldn’t be the first time that BHP was identified as a potential buyer for Walter. The first reports of such $6 billion offer for Walter came more than a year ago, and lasted through May of this year. While it could still happen, a healthy skepticism seems in order.
Nonetheless, coal mining stocks are getting a boost today. Walter is up 6% at $30.25 in a 52-week range of $28.01 to $76.95. And Walter’s market cap at today’s stock price is less than $2 billion.
Peabody Energy Corp. (NYSE: BTU) is up 1% at $25.29 in a 52-week range of $18.78 to $39.74.
Arch Coal Inc. (NYSE: ACI) is up more than 2% at $6.70 in a 52-week range of $5.16 to $16.88.
Alpha Natural Resources Inc. (NYSE: ANR) is up 2.7% at $7.37 in a 52-week range of $5.28 to $25.48. Alpha also has large reserves of met coal thanks to its acquisition of Massey Energy.
James River Coal Co. (NASDAQ: JRCC) is up 7.9% at $3.82 in a 52-week range of $1.68 to $8.67.
The Market Vectors Coal ETF (NYSEMKT: KOL) is up 0.2% at $23.65 in a 52-week range of $21.49 to $37.39.
Paul Ausick
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Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.
He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.