suggests someone very slowly, carefully accummulating.
Sentiment: Strong Buy
they buy when the market is high and shun assets when market is low. Case in point... coal companies. Just a few years ago, at height of market, BTU, ACI WLT and ANR all made very expensive purchases of other coal companies; ANR paid 7 billion for Massey, outbidding a number of other players. ANR now has a market cap of just over 200 million, selling for barely 8% of tangible book value. Why is ANR not being courted for a buy out. They are the 3rd largest met coal producer in world; they have the most port capacity of any U.S. based coal company; they have something like 120 customers across five continents; they have rail and highly developed transport and processing infrastructure; they have state of the art IT, management, equipment and miners/engineers; they have over a billion in cash; two joint NG ventures; no serious debt due till 2018; huge infrastructure spending is coming in U.S., Japan, China in near future; easy money planned for Europe... ANR is surely the buying opportunity of a lifetime... I would urge management to put her on the block just to see who might bite... geez, better than waiting around for another year or two before coal prices recover... come on management... sell her!... we could easlily get 5-7 bucks per share and I'm certain the avg investor cost basis is far below that... put her up for sale!!!
"Management has made the company an unlikely buyout candidate..." . How so? They settled lawsuits, they sold off noncore assets, they have hoarded over a billion in cash, they have two joint ventures in natural gas, they are 3rd largest met coal producer in world, they are selling at about 7% of book... seems a great buyout candidate to me.
Sentiment: Strong Buy
They have over a billion in cash; costs are way down and improving still; they do about 4 billion in revenue per year and EBITDA remains positive as does levered free cash flow; the company could buy back just 10 million shares for a piddly 10 million plus dollars. News of that buyback would push stock way over the dollar limit and have no impact on future debt obligations and show mngmnt's faith in future of company and probably be a good investment ... share buyback at this price seems so rational, so what's the problem?
Never seen anything like it. Just imagine... a few years ago ANR paid 7 billion for Massey. Now they can buy back all of their stock for less than 1/4 billion.... I just don't understand why a major miner does not initiate a hostile takeover... ANR now selling for about 7% of tangible book
Addendum: Coal demand has shrunk in the U.S but world wide coal demand remains robust. Met coal is bottoming and really can only go up from here. Consider new infrastructure spending planned in India, Japan and USA. Cars are selling like rice cakes in US, China. Steel demand can't remain subdued forever, can it?
When are these mega-miners, cash rich w/ multibillion dollar EBITDA, e.g., Anglo American, Coal India, Glencore, Rio, BHP going to scoop up these U.S. miners that are now selling for a fraction of book value. ANR is less than 1/10th of tangible book value. Why develop a new mine with all the logistical hassles and uncertainties in some ungodly part of the world when you can get the best and most plentiful coal assets, both met and thermal, in the USA, complete w/ highly developed infracture, rail and port svc, coal processing plants, state of the art mining equipment, state of the art mining-specific IT svcs and highly trained miners, engineers and managers. It amazes me. The combined market cap of BTU, ACI, ANR and WLT is chump change to these mega miners. It is very strange that there is not a peep of a possible acquisition on the horizon.
now trading at less than a tenth of book value. some big miner or steel maker could buy the company on the open market for a trivial amount of money and control the 3rd biggest met coal producer in the world. surprised it hasn't happened yet.
To Whom It May Concern:
Today we broke lower resistance and there is currently no bottom. The stock is now selling for a tenth of tangible book value. Sentiment for coal is bleak and recovery years away (if ever for U.S. coal). Please help out the longterm investors, who are all far underwater and losing opportunities elsewhere. Salvage company value and put the company up for sale while we still have cash and very good assets. I am sure a big international miner w/ vast EBITDA would be happy to have this company and it's excellent assets and huge met coal reserves at a discount to BV. They could probably turn this company profitable immediately by paying off our accummulated high interest debt. Consider Coal India, Anglo American, BHP, Rio, Glencore. Also consider some large private German or Dutch firms that would probably value owning ANR for a reliable source of met coal as we are just over the pond and not prone to the political instabilty of east block/Russian suppliers. We should easily get 4-7 dollars per share. Please consider selling the company and soon, as the opportunity costs are considerable.
Thanks for your attention in this matter.
Any response would also be appreciated.
at end of 2014 Q3, tangible book value=14.48/sh; current share price=1.69
current price to tang bv= .116
NG is chief competitor of coal. NG prices are at historic lows and will reverse dramatically in coming year or two as U.S. LNG exports get underway; as U.S. mfg w/ NG as feedstock continue to come on line; as NG vehicle transport continues to gain growth; as worldwide demand for electricity grows
ANR has cash on hand and reduced capex and will remain solvent to 2019 even if coal prices stay current
This company is grossly undervalued and could easily be bought out in coming year.
Sentiment: Strong Buy
Natural gas will trend up and up and up beginning in late 2015 or early 2016, as LNG export projects start coming on line (beginning w/ Cheniere); also huge manufacturing projects that utilize NG feedstock will come on line; lastly, LNG and CNG vehicles and municipal fleets continue to expand across cities everywhere
Sentiment: Strong Buy
McLEAN, Va., Dec. 22 (UPI)- The Dynalectron Corporation said its proprietary H-coal liquefaction process had passed a series of critical tests at the pilot plant at Catlettsburg, Ky., operated by a subsidiary of the Ashland Oil Company under a Department of Energy contract.
Dynalectron said the latest test run, begun Aug. 2 and completed Dec. 11, converted 19,200 tons of coal, dried from 22,000 tons of mine-run coal, into synthetic low-sulfur oil with a high naphtha content that can serve as feedstock for high-octane unleaded gasoline and heating oils.
The small pilot plant is designed to process 220 tons a day and was operated around the clock during the run. The run was completed without incident. The oil yield improved as the run progressed.
The company said the success of the test run indicated that a commercial H-coal liquefaction plant to be built in Breckinridge County, Ky., would be able to produce the hydrocarbon equivalent of 50,000 barrels of oil daily from 18,000 tons of dried coal.
... This is real and will give coal a new lease on life for years to come.
Sentiment: Strong Buy
scoop up these American coal companies... for just a fraction of their EBITDA any one of the big miners could buy them all.. why bother developing a new mine when you can have the whole American lot for pennies on the dollar with developed labor force, infrastructure, top of the line equipment to boot. you can get rid of their managements and save 100 million in yearly operating costs alone... geez, it was just three yrs ago or so when ANR bought Massey for 7.1 billion. The cumulative market cap of ACI ANR WLT and BTU is just over 3 billion.. for example, BHP has 8 billion in cash and EBITDA close to 30 billion... Far out.
They could vastly decrease management costs, be a serious global player, merge customer bases, improve logistical efficiencies worldwide... great idea, right?
but its the bottom of the cycle and a merger could reduce their operational costs and allow them to survive longer until the market turns, especially met coal, which is expected to turn in 2016.
Could be mutually beneficial... cheaper admin costs, logistical synergies, expanded customer base, larger revenues, lower debt to equity, better financing prospects