Sector Snap: Analyst Rates Coal Stocks "Buy"

NEW YORK (AP) — The coal mining sector will struggle under constrained volumes for the rest of the year, but should rebound in 2010 on a strong price recovery, said an analyst on Thursday who reiterated his "Buy" rating for a number of coal stocks.

Stifel Nicolaus & Co analyst Paul Forward predicted dismal second-quarter and full-year results driven by lower shipping volumes and the fact that most firms have the majority of their planned coal production committed, leaving few opportunities to gain from price strengthening.

Demand for all types of coal has continued to remain very weak, but the sector has responded quickly by cutting domestic coal production, a move that could prompt an eventual recovery in coal pricing, Forward said. ...