Lowest cost producer, transportation increases costs and limits full capacity of 30 million, steadily declining output, heavy debt load, declining industry, and no positive catalysts regardless of peer bankruptcies.
Is that a fair assessment? Consol Coal currently yields near 30%, but DCF valuation has it at a earnings yield of 15%.
In order for these coal companies to receive higher valuations, coal prices and/volumes have to increase. Does anyone have any idea when that will happen? Any signs that it is or catalysts for it to happen are underway?
I've been warning against coal since 2013 after being burned in 2011. Best thing I've ever did was sell Peabody at $35 (unsplit price) after buying at $60. Adjusting for split terms, $60 translated to when Peabody was $1,100. Yet, Peabody is still "surviving."