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Arch Coal Inc. Message Board

thethirdchimp 23 posts  |  Last Activity: Sep 10, 2014 10:14 AM Member since: Sep 5, 2007
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  • thethirdchimp thethirdchimp Sep 10, 2014 10:14 AM Flag

    Iron ore glut due to excessive production of iron ore could possibly be good for met coal. right? cheap ore means cheap steel means more attractive pricing for steel products leading to boost in demand for steel-based products and thus, boosting demand for coking coal

    Sentiment: Strong Buy

  • Reply to

    Stuck in Range for Another Year

    by thethirdchimp Sep 8, 2014 11:20 AM
    thethirdchimp thethirdchimp Sep 9, 2014 9:58 AM Flag

    from what i've read, china wants to reduce air pollution in big cities. they are embarking on huge coal gasification projects. i do understand that they want to reduce import of low quality coal. however, with advanced scrubbers, low sulfurr coal is not necessary. in fact, it is preferable to make the investment in advanced scrubber systems and then buy cheaper high sulfur coal which often has higher btu ratings. this is what is happening right now in US as high sulfur Illinois Basin coal has been stealing market share from both app and PRB coal at a fairly rapid rate, according to the recent Bloomberg article. I'm pretty sure the recent down turn in ANR, ACI and BTU is related to this news. I will remain long ANR because I believe that the supply/demand dynamics will turn in one or two years and then it's up up and away. Holding for at least book value.

    Sentiment: Strong Buy

  • Probably old news for many but new article from Mother Jones points out that methane leaks from gas drilling is a worse scenario than burning coal as far as climate change/greenhouse effect. The implications should be game changing but not likely, at least, in near term.

  • Reply to

    Stuck in Range for Another Year

    by thethirdchimp Sep 8, 2014 11:20 AM
    thethirdchimp thethirdchimp Sep 8, 2014 2:41 PM Flag

    Why the suspense? I'd like to hear about the plenty of reasons. I'm open to sound reasoning.

  • thethirdchimp by thethirdchimp Sep 8, 2014 11:20 AM Flag

    As I warned just about a month ago, when ANR spiked over 4.00, don't get too excited because the stock price will not move up in any serious sustained way until the market believes in a return to profitability. There will be no profitability this year, that is already a foregone conclusion and ANR management says as much. Joy Global just reported bad earnings which they attributed in large part to reduced Capex in coal mining. They further stated their expectation that the supply glut in coal, met and thermal, would persist until at least mid 2015. In my opinion, this and other coal stocks will be stuck in a range for another year. We seem to be at a balance point between the outgoing scared and the incoming long term value investors. Money can still be made while you wait as the supply/demand rationalization plays out. Sell out-of-the-money covered call options and use the proceeds to add shares. As you add shares, you can sell yet more covered call options. It compounds and you can make some good money. I've been doing it since 2/2013 and have only got sold out once and was able to reenter at an even lower cost basis, while further increasing my share count. My aim since 2013 has been to accumulate shares. capital appreciation has to wait. I will stick with this strategy for the rest of 2014 for sure and will get increasingly cautious through 2015. I believe in the coal rebound and a new long term up cycle but it is all a question of timing... very tricky of course

  • Reply to

    Why are we down?

    by benstevens75 Sep 5, 2014 1:20 PM
    thethirdchimp thethirdchimp Sep 5, 2014 3:29 PM Flag

    Looks like a response to recent Bloomberg article. Illinois basin coal stealing market share, selling very cheap and production is actually increasing and huge capex going on there as we speak. right in heart of coal burning country. cheap dirty coal turns out to be an advantage as all coal burning utilities need to install scrubbers anyway to meet new EPA regs. Illinois basin coal has higher heat content than PRB coal. . more than 150 years of coal there at current level of consumption. app coal, at least for u.s. consumption, appears doomed. market seems to be responding to implications.

    Sentiment: Strong Buy

  • Reply to

    So long folks

    by gte196y Aug 26, 2014 1:50 PM
    thethirdchimp thethirdchimp Aug 27, 2014 8:34 AM Flag

    This is an extremely bullish sign. I think I will take up a new position in BTU right away.

    Sentiment: Strong Buy

  • Reply to

    Why This Billionaire Still Believes in Coal

    by thethirdchimp Aug 20, 2014 6:00 PM
    thethirdchimp thethirdchimp Aug 20, 2014 9:45 PM Flag

    rising demand, at least, through 2020, rising by 25% to 4500 million tons. that's glencore's take. investing nearly 5 billion to increase production is a lot of conviction. I just thought it interesting. here's a link
    http://www.fool.com/investing/general/2014/08/20/why-this-billionaire-still-believes-in-coal.aspx

  • Interesting Motley article. Glencore is making a contrarian bet. Planning to invest nearly 5 billion to boost coal output and anticipates 21% increase in production through 2016. The CEO is from So. Africa and knows his business... hold and accumulate

    Sentiment: Strong Buy

  • Reply to

    Remember...

    by thethirdchimp Aug 18, 2014 7:35 AM
    thethirdchimp thethirdchimp Aug 18, 2014 12:38 PM Flag

    those are reasonable catalysts in near term. in fact, I plan to avoid selling covered call options in month of November because of the elections and also by that time ANR might give more details about JV. but the real supercycle and the giant 40-70 dollar move comes when the company again shows a profit which I have no doubt will happen as the supply-demand dynamic rebalances. coal miners, though, are very very stubborn and slow to cut supply and govt's damn slow about investing in infrastructure... but both are happening gradually before our eyes. recently read that India plans to spends a trillion on infrastructure over next decade. the USA , though, is the one to watch. next presidential cycle could bring a massive investment in infrastructure (e.g., bridges, water mains) and if they can lower the damned corporate tax, we could see private capital invest huge in big steel projects, e.g., pipelines, factories.. met coal will be the main driver for ANR

  • Reply to

    Remember...

    by thethirdchimp Aug 18, 2014 7:35 AM
    thethirdchimp thethirdchimp Aug 18, 2014 12:04 PM Flag

    Why Appalachian Coal Can’t Compete With Colombia

    Consider: Why Appalachian Coal Can’t Compete With Colombia
    Deep in U.S. coal country, people are suffering economically not just from the White House’s determination to reduce America’s dependence on coal, but also because of competition from an unlikely place: Colombia.
    To be sure, an abundance of cheap natural gas is responsible for most of economic hurt in mining states like West Virginia, Kentucky, Tennessee, and Pennsylvania. Record natural gas production from shale has given utilities a cheaper, and cleaner, fuel.
    Also, as Republicans are eager to point out, environmental regulations have put a gradually tightening noose around the neck of Big Coal. With new limits on toxic emissions, and looming new restrictions on greenhouse gas emissions, the coal industry is facing a period of structural decline.
    But surprising data just released from the Energy Information Administration shows that Appalachian coal is losing market share to cheaper coal from Colombia.
    Despite being one of the largest producers of coal in the world, the U.S., confusingly, also imports coal. That’s because imports from Colombia can be cheaper, at least for the large market on the U.S. East Coast.
    There are a few reasons why.
    First, labor is cheaper in Colombia. Second, maritime shipping is cheaper than rail to some places on the U.S. Eastern Seaboard. For example, moving coal from Appalachia – from mines in West Virginia, Kentucky, Tennessee, and Pennsylvania -- to Florida adds $26 to a ton of coal, while importing Colombian coal adds just $15 per ton.
    Beyond that negative, the coal seams of Appalachia have been mined for over a century, and consequently, the richest coal deposits have been mined out.
    Another advantage of Colombian coal is that it burns relatively cleanly, with low sulfur. For utilities seeking to comply with increasingly stringent limits on air pollution, low-sulfur Colombian coal can provide added flexibility.

  • Reply to

    Remember...

    by thethirdchimp Aug 18, 2014 7:35 AM
    thethirdchimp thethirdchimp Aug 18, 2014 9:32 AM Flag

    I'm not short. I have a ton of shares and have been accumulating shares for well over a year now. Your reading too much into my stance. It is exactly as I say. I anticipate depressed coal prices for at least a year and no profits for 2014, 2015 and possibly into 2016. Investors are forward looking but not that forward looking. I just don't see the stock moving up much until coal stock prices recover and profitability is more assured, especially given current debt load of most coal companies. I'm long and strong and have more shares that I want to say. What is the problem with my argument? Can't I be long a stock and also negative on short term stock price prospects? What is your bull case for the short to mid-term?

    Sentiment: Strong Buy

  • thethirdchimp by thethirdchimp Aug 18, 2014 7:35 AM Flag

    ANR will lose money every coming quarter this year and throughout 2015. The company anticipates this themselves. There is a good chance the company loses money in 2016 and possibly into 2017, as well. There is analyst and expert consensus that coal prices, met and thermal, are at, or near, a bottom and will linger here for the rest of 2014. Many analysts predict that we do not see price recovery until late 2015. Coal stocks are dead money, but for an occasional bounce here and again, until late 2015, possibly later. Then, of course, the long bull cycle in coal gets underway. The best strategy is to accumulate coal stocks now, while we languish at the bottom, maybe selling covered call options for some return and reinvestment. Remember, the coal industry has great near to mid-term visibility. The glut of supply is real and measurable, near and midterm demand is also real and measurable; thus, predictions for one to two years out tend to be accurate. Don't get too excited by any spikes, nor too discouraged with new lows. The super bull cylce is real and will happen, but will not begin in earnest for at least one to two years.

    Sentiment: Strong Buy

  • thethirdchimp thethirdchimp Aug 15, 2014 2:26 PM Flag

    Apparently an Indian company. India has been looking to acquire coal assets internationally to feed their huge and growing demand and work around incompetent domestic suppliers and low grade Indian coal. True, the rails will take years but investors look out and this news does not help as all coal stocks languishing due to worldwide coal glut that Citi analysts could be prolonged. Hey, I'm long coal and believe in the super coal cycle but I just don't think it happens until 2016 and I don't see big moves in stock price until late 2015. I'm accumulating and holding, trust me. Why can't you bozos look at reality. There will not be any big rise in share price in near future.

    Sentiment: Strong Buy

  • 100 million tons per year will pass along the rail from Galilee Basin. This puts yet more downward pressure on coal prices.

  • ANR expects to lose money for the rest of this year and through 2015; not going to return to profitability until 2016 at earliest, possibly 2017, depending on coal pricing. All reports clearly say that thermal and met coal supplies are in a glut and will remain so for another year or even two years. The Austrailians, in fact, have been increasing exports and will continue to do so to fulfill contractual obligations in spite of losses. This stock is a long term play as the market corrects and we then enter a new coal supercycle. the strategy is to accumulate and hold, possibly selling out of money covered call options to get some cash for further buys. the covered call strategy is risky, though, as the stock is high beta and could get sold out, though should not be hard to get back in on pullback... by end of 2015, i would avoid the covered call strategy because the stock price could get away from you... hold.. the supercycle begins in earnest by 2016 and we could see 40+ dollars per share by 2017 or 2018... at least, that's how i'm playing it... accumulate and hold

    Sentiment: Strong Buy

  • thethirdchimp by thethirdchimp Aug 5, 2014 11:03 AM Flag

    ANR is selling about four times cheaper then WLT. Makes no sense. ANR is a 10 dollar stock.

  • Reply to

    This is why ANR has not sold mines to India

    by dealindave2000 Jul 31, 2014 8:35 PM
    thethirdchimp thethirdchimp Aug 1, 2014 6:29 AM Flag

    Maybe 50 million is overpay. Lots of problems with infrastructure, flooding, corruption in Mozambique.

  • Improving cost structure and slow cash burn to survive the depressed coal environment... yea!! we go up... or further evidence of weak pricing environment... boo! we go down

  • Reply to

    ANR High Beta Spikes Hard

    by thethirdchimp Jul 24, 2014 12:54 PM
    thethirdchimp thethirdchimp Jul 24, 2014 2:55 PM Flag

    correction 8/7/2013 closing 4.92 and 11/11/1013 closing 8.03

    Sentiment: Strong Buy

ACI
2.64-0.01(-0.38%)Sep 19 4:01 PMEDT

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