I am a longterm holder of ARLP. I do write covered calls against it, but on the few times I am called I just rebuy it. I am scratching my head trying to figure out why the price has dropped. ARLP has good earnings, good revenue growth, and pays a good, sustainable dividend. It has a fairly high debt load, but with a 30% growth in revenues it is a debt that the company can handle. Spot prices for coal have been steady to slightly rising. In summary, everything I see tells me this is a good company.
I am somewhat suspicious with the earnings date almost upon us. Is it possible that the "smart" money knows something I don't? Perhaps. But, you can buy this now at 73.64 and write the covered call for $2.30 with 75 as the strike price one month out. If you loose it, you get a quick 5% for one month. If you don't, you pocket $2.30 (plus the dividend). Hard to see that as anything but a quick, easy trade. What am I missing?
Yet the supposed safer alternative (amongst others) is not as safe or worse. (done tons of research on nat gas fracking and unlike radioactive matter it(the chemicals used) NEVER biodegrade). (and due to BushCheney allowing these companies to bypass all the Nixon environmental laws - the toxicity is now widespread across America ie dead rivers/species) and those fires in PA (explosions due to contaminated land and water).... only now surfacing in media after decades of damage.
Gas from 'fracking' worse than coal on climate:
Study. Cornell University professors will soon
publish research that concludes natural gas
produced with a drilling method called "hydraulic
fracturing" contributes to global warming as much
as coal, or even more. Washington Hill, District
Study: Gas from ‘fracking’ worse than coal on climate
By Ben Geman - 04/10/11 02:40 PM ET
Cornell University professors will soon publish research that concludes natural gas produced with a drilling method called “hydraulic fracturing” contributes to global warming as much as coal, or even more.
The conclusion is explosive because natural gas enjoys broad political support – including White House backing – due to its domestic abundance and lower carbon dioxide emissions when burned than other fossil fuels.
Cornell Prof. Robert Howarth, however, argues that development of gas from shale rock formations produced through hydraulic fracturing – dubbed “fracking” – brings far more methane emissions than conventional gas production.
Enough, he argues, to negate the carbon advantage that gas has over coal and oil when they’re burned for energy, because methane is such a potent greenhouse gas.
“The [greenhouse gas] footprint for shale gas is greater than that for conventional gas or oil when viewed on any time horizon, but particularly so over 20 years. Compared to coal, the footprint of shale gas is at least 20% greater and perhaps more than twice as great on the 20-year horizon and is comparable when compared over 100 years,” states the upcoming study from Howarth, who is a professor of ecology and environmental biology, and other Cornell researchers.
I own both and AHGP certainly did sell off (tanked after announcement of secondary offer at 54)... but I've owned both for a while (although 2nd trading position in ahgp under water - not concerned for long haul).
Japan news caused those traders (big boys) to get in and momo it up. As well it's been on IBD list and other "news" outlets where those looking for a trade pile in then pile out.
We shall see about the upcoming cc... but I am holding for distribution now so although it's GHASTLY on paper I try to remember my original intent. (ie to stop trading - and hold for distribution).
i am a long term holder as well, luv the distribution. i'm in at $29 so at least one of my equities is doing well. don't know y the sell-off. earnings should be good. oh well, i'm i just sit here and watch the action! glta