Sector Snap: Coal Companies Slide

NEW YORK (AP) — Shares of coal companies fell with the broader market Thursday as an analyst downgraded several players, saying they will be hurt by lower demand, competition from natural gas, swollen stockpiles and underutilized steel mills.

Dahlman Rose analyst Daniel Scott downgraded Alpha Natural Resources Inc. and Foundation Coal Holdings Inc. to "Hold" from "Buy" and Patriot Coal Corp. to "Sell" from "Hold."

Scott said coal stocks have rallied too far over the past several weeks and could see a pullback in the near term. Scott noted that the domestic coal sector is up an average 82 percent quarter-to-date and 61 percent year-to-date. Despite encouraging production cuts and news that Alpha will acquire Foundation Coal, "the underlying commodity continues to lag," Scott said. ...