Commentary
Time to take a close look at coal
23 May 2012 by Jim Fickett.
There is a great deal of bad news lately about coal – electric utilities switching to natural gas, heavier regulation on pollution, slowing deliveries to China. However coal will remain a primary fuel for a long time yet, and the market is probably, as usual, over-reacting. Below is the recent price history of Peabody, the largest of the North American coal companies. The price is almost back down to the panic lows of late 2008.
I am not (yet) saying coal or Peabody is a buy – just that from the price history alone, it certainly looks to be worth taking the time for a real valuation.
Discussion
Jim, you might take a look at some of the work my friend Gregor Macdonald has done on coal over at http://gregor.us. He has a lot of analysis of global usage trends, etc, and he believes coal will continue to grow as an energy source in China etc.
I have read Gregor some in the past. Thanks for the reminder.
Thanks for your input.
One doubt on coal I have is if globally coal is to remain as a main source of energy while it is probably decreasing in USA and Europe and remain very strong in China and India why buy coal companies in the US?
For the record, I know nothing, yet, about Peabody or other Coal companies.
Enrique.
It's a good point. If you search on coal you'll find some other posts where I attempt to analyze the US market specifically.