I am really confused about this trashing of ARLP. Coal prices are still substantially larger then last year. Coal companies have been signing better longterm contracts. I would, of course, love to hear some confirmation of this from ARLP management. But, ARLP management has stated that the next four quarters will have a 6% increase per quarter in dividends. They have said that this is based upon the most prudent of projections. And, frankly, given that this company is not leveraged to financial toxic bonds, I see no reason it should be moving forward.
And, yet, the stock tanks. Right now ARLP is paying north of 14% on its stock. Where do you beat that? And, frankly, I do not see much risk in that dividend. So, why are we getting crushed?
This is crazy.
So many excellent companies have had their share prices mercilessly slashed.
I loved ARLP. It has been so good to me over the years. I originally bought 750 shares back in October of 2001, shortly after 911. ARLP since then had split and was about a five bager at its 52 week high. It even payed out more in dividends then my cost basis.
Over the last 15 years I've been grooming and cultivating a nice portfolio which was worth over $300,000 back in August.
A few months ago I owned shares in 12 different companies of which ARLP was my biggest holding and dividend payer. My combined income was over $1,500 a month in dividends which was a nice supplement for my somewhat smaller military pension.
Over the last four months everything went to go to crap. The market started its downward slide, first slowly then accelerating each and every day for the last several months. I can handle volatility, but this market is sick. By the 10th of October the decline was too much for my nerves, so I panicked and liquidated my entire portfolio. At the time I walked away with lots of losses but overall still making a small profit.
Shortly after liquidating my portfolio I felt really sick about what I did. I killed my golden goose and will now have to live off a military pension of $1,196.60 per month.
This stressed my out so bad I developed stress tennitus and my ears continuously ring.
Of course immediately after liquidating my portfolio, the market rallies over 700 points. This rally made me realize I jumped out of the boat and lost my dividends. So In haste I took my remaining $190,000 in cash and bought 3000 shares each, ARLP, EXM and GE, neglecting the wash sale rule (god I'm an idiot). I picked these 3 because they would give me the equivalent dividend income of my previous 12, and if they would ever to return to their 52 week highs, my portfolio would be close to a million dollars.
After making this foolish decision the market continues its slide down the toilet. I put stop losses on the three and now ARLP and EXM gone at substantial losses.
At this time I still have GE, but my net worth was cut down to about $130,000. I hope GE survives and doesn't go below its stop loss.
I'm glad I liquidated a third of my portfolio three years ago to pay cash for my house. In retrospect I wish I had bought a nicer home.
Now I'm starting to believe I should have just left everything alone. Perhaps this market will recover eventually. After getting burned by this market and my own foolishness, I'll be reluctant to jump back into stocks.
Good luck to all ARLP share holders.
Chiles, good luck to you. If it's any consolation, you're not in the boat alone. My account was worth about $395k in June, thought I'd be a millionaire by November. I'm too embarrased to tell you what it's worth now. I guess you just can't fall in love with these stocks.
Chilesgreen: It is good you bought the home.
I am 73 and still working and will forever. Don't mind love to work.
What you did is what thousands and thousands of stock holders did in the past few weeks and days.
Fear and panic are part of human feelings. Now you have wisdom. So you can build on that.
Can you work. Or are you ill.
I constantly wonder why people stop working. Not really wonder because I know human nature. So. There WE Are.
Where to you beat that? Just look in my portfolio. I have several stocks paying 18% and higher. I consider them to be safe, yet they go down every day. The most extreme example is listed at 358.8%. Unfortunately, it has dropped dividends for the rest of the year, but I expect them to resume, as the company continues to make money. I have a municipal bond fund that pays over 8%, tax free. The market is just crazy. If you can call the bottom, this is the buying opportunity of a lifetime. Somebody will call the bottom, and I wish it would be me.
Guessing or watching for the bottom is a mistake. Just my opinion, but if you have a little money, buy a little ARLP and some AHGP at least once each week. Stop fussing about the bottom. It WILL go back up. These companies will make money for you. And at these prices I do not know of a better return.