They fired Ron Johnson 5 months ago and have plenty of time to find a new CEO. Ullman looked, pretty foolish yesterday and I would think he will be gone pretty quickly. Bad news is out, everyone hates JCP, now bring in a new CEO with retail experience. I think JCP will turn it around but if they don't replace the CEO and chairman quickly, they are toast. Throw out some off the board members too, what a bunch of clowns. Volume and selling pressure was amazing the last few days, reminded me of 2009.
Agreed, but the management at JCP has botched everything with their lousy communcation skills. They have had 5 months to find a new CEO, Ullman isn't going to be the guy that turns things around. I look at BBY and I am amazed at the turn around in the stock which is not warranted in my opinion. Two 100 million share days back to back is captiulation in my book.
Sentiment: Strong Buy
Not everyone agrees with your take on BTU. If that is nuts, then so be it. Your accessment of BTU hasn't been exactly spot on now has it.
I agree, the move away from coal in the US will continue, what happens in other countries is still up for debate. Solar, wind and other alternative energy are for the most part in their infancy and demand has nowhere to go but up. Perhaps, after consolidation i.e. bankruptcy, in the sector, BTU can thrive again. I still think it will be a tough place for investors to make money.
I think it is a combination of deteriorating long term fundamentals, too much supply and falling demand. Debt is also a contributing factor. While things could get better in the short term for BTU, I think longer term things look pretty bleak. This is what Warren Buffett had to say on July 22, 2013.
Coal use in the U.S. will continue
to fall though the slide will be gradual as electric utilities
switch to cleaner alternatives over “years and years,”
billionaire Warren Buffett said at an event in Indiana this
“Coal will gradually decline in importance, and of course
when natural gas prices get low enough you have a big switch
over,” Buffett said July 22, according to a recording posted
online by WFYI, a public radio station in Indianapolis.
“Coal plants are producing about 38 percent of all the
electricity in the United States now,” Buffett said. “You
can’t scrap that. That takes years and years and years to
replace. It will be happening gradually.”
While Mr Buffett might not always be right in the short term, he has usually been spot on longer term. There is more in the article and he does say things could improve if Nat gas prices increase but overall he is very bearish on coal. I think BTU will be in single digits sometime next year.
There is no reason to get killed in any investment, that is what stop losses where made for. All stocks correct but BTU is way beyond what any investor would consider a correction. It is in a secular bear market and you don't average down in a secular bear, you walk away or go short. BTU might very well be best of breed but it is in the middle of an all out commodity rout. Stock is already telling you the 52 week low won't hold.
Longs will get another chance to buy in the low $14's if that is indeed the long term bottom. BTU is nothing if not predictable on earnings day, a rally, followed by a multi week sell off. This market is overbought, no reason to go long here. I picked up WLT several weeks ago at $11 and sold yesterday when it popped at the open. Looked overbought to me and I had a very nice profit. WLT getting pummeled today, am I a buyer, nope.
BTU has for the most part risen on the day they report, only to tank hard over the next several weeks. The bounce in the last couple of days given the drop in the stock is unimpressive. Market is overbought again on low volume. If they miss and see improvement going forward, BTU should go higher. If management gives tepid guidance, I think BTU will be dead money.
Really, then why is oil over $100. Tell me is that inflation and demand driven, no it is not. The economy is not horrible and it appears to be getting better but maybe that's not what some on wall street really want. Commodities in turn should reflect better economic conditions.
Commodities have not priced in any type of recovery at all. Wall street only wants one thing more and more QE. Heads, commodities lose and tails commodities lose. Can't stay that way forever, good news should be just that, good news. and that should include stocks like BTU.
Refiners like TSO and VLO based for 2 years before they recovered. BTU is in no mans land, trying to find a bottom along with every other coal, steel and iron ore stock. Hard to believe but it looks like it wants to go lower from here and I see no reason to believe it won't
I am not sure what those incentives would be. Other then a trading rally, this stock is in full meltdown along with many other commodity stocks. Like I said, I do expect a rally back to the $20 area and that would be a gift for longs at this point. Lower highs followed by lower lows for over 2 years doesn't indicate a long term bottom to me.
I remember when everyone thought last year that $30 was the bottom. Here we are one year later at $14.64.
The fact that BTU did not hesitate to break the 2008 low should be a red flag for investors. Stock is extremely oversold though and I am looking for a bounce back to the $20 area. Commodities continue to reinforce my belief that they make lousy long term investments.
The refiners are up 3% too, doesn't mean anything. BTU will not go up alone, there needs to be a broad based commodity rally.
What's amazing to me is stocks like HD, SBUX,COST,BWLD, and there are a lot more are all clearly overvalued and remind me of the top in 2007. Commodities and basic materials are trading like a depression is right around the corner. CNBC is in full whine mode now about tapering and Bernanke. I would not short here but it would be tough to go long until BTU at least trades sideways for a bit. This isn't just about coal; steel, iron ore and copper are all in freefall.
I think if you are patient this is a good place to buy BTU. With that being said I don't like any commodity stock as a long term investment. I Picked up WLT a few days ago and from a trading standpoint it looks better then BTU but has more risk. As far as a final flush goes why bother to wait for that, the stock has already been obiterated. BTU needs to base then move up on volume and that just hasn't happened yet.
Greenspan coined the phrase" irrational exhuberance," this is irrational pessimism. The fed finally did the right thing and wall street is having a hissy fit. Just look at long term chart of HD and tell me it's not overvalued. It has gone practically parabolic. Commodity stocks are trading like it's the end of the world and stocks like HD are trading like house prices are going up 20% a year again. Wasn't that what got us in trouble in the first place. Buy em when they hate em and wall street hates commodities, like BTU.
He really has become a contrarian indicator. CNBC already wringing their hands about the small correction in the SPY. I remember when Jon Najarian thought WLT and BTU where screaming buys near their highs. Now they love TSLA which is never going down as far as their concerned. Everyone knows how that will end when the music stops or should I say when the momentum traders exit.
Well I'm not an emotional beast, I'm a trader and commodites have been obliterated here. As far as I know there isn't a world wide depression going on and that's the way they are trading like at this point. Time to buy.