This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Coal Company Shares Extend Decline

The Associated Press

Shares of several major coal companies extended their months-long decline Monday after one of the largest coal companies said it plans to limit its operations due to weak demand for coal.

Alpha Natural Resources Inc. announced Friday that it plans to idle four mines in Kentucky, close four other mines being operated by contractors and curtail production at other facilities. The Bristol, Va., company is also closing some satellite offices by the end of the year to consolidate support functions. About 150 jobs will be eliminated.

The news was another reason for investors to flee the already challenged coal market.

Mild winter and spring weather reduced demand for coal from utilities that use it as fuel to generate electricity. Additionally, utilities and some manufacturers have switched from coal to cheaper natural gas for fuel. The price of natural gas has fallen nearly 25 percent this year because booming production has produced a glut, further weakening the attractiveness of coal.

As a result, a number of coal producers have cut back production and shuttered mines to reduce costs.

Alpha's shares hit all-time lows in trading Friday and set new lows again Monday. Its shares sank 47 cents, or 5.1 percent, to $8.85 in afternoon trading. Alpha's share price is down more than 80 percent from its peak last June of $47.54.

"The U.S. coal markets have been pretty doom and gloom lately," Raymond James analyst James Rollyson said in a research note Monday. "In fact, many of the coal equities act as if they are going out of business."

The lone bright spot, Rollyson writes, is in the export market. U.S. coal exports are on track for a record year, he said, thanks to the timing of some contracts and supply issues from other exporting nations. But this bright spot could fade quickly if the global economy were to weaken further.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.74 -1.15%
FB $117.58 0.73%
GOOG $693.01 0.29%
TSLA $240.76 -2.81%
YHOO $36.60 0.03%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs