BOSTON ( TheStreet) -- Coal never seems to lose its luster.Shares of U.S. producers of high-grade coal used in steelmaking are rising on expectations they will get much higher prices on a jump in demand as flooding in Australia has shut mines and roiled the international market. Even before the events in Australia, institutional investors had been buying big stakes in U.S. metallurgical coal producers. BlackRock ( BLK), one of the world's largest institutional investors, bought an 18% stake in Massey Energy ( MEE) in the period ending Dec. 31, while Fidelity raised its holding to 13% of its shares at the end of the third quarter, it's most recent reporting period, according to Morningstar data. Massey's shares are up 3% this year, which brings its market value to $5.7 billion. The stock tripled in 2009 and rose 28% last year. Individual investors are now being advised to take a look at the sector. Last week, Deutsche Bank ( DB) initiated coverage of several companies with metallurgical mines. It gave Patriot Coal ( PCX) and Walter Energy ( WLT) "buy" ratings, and Massey Energy a "hold" rating. "We favor North American coal companies with exposure to the metallurgical coal market that are reasonably valued," Deutsche Bank analysts said in a note to clients. "Logistical constraints and supply disruptions are catalysts that can drive volatility and support higher prices." Patriot's shares are up 27% this year, but analysts are mostly negative on its shares, giving it one "buy" rating, eight "holds" and three "sell" ratings, according to FactSet. That hasn't deterred institutional investors. ArcLight Capital is Patriot's largest shareholder with a 12% stake, according to a Dec. 22 filing from the firm. Walter Energy's shares are up 1% this year. Fidelity bought 1.2 million of its shares in the third quarter, upping its stake to 3%, which is about half that of Harris Associates, the largest shareholder. Penn Virginia ( PVA), a U.S. oil and natural gas producer, is also seeing buying from big institutional investors, despite its market value of only $815 million. BlackRock initiated a 16% stake in Penn Virginia in the reporting period ending Dec. 31, while in the third quarter, Seneca Capital initiated a 4% stake, and Artisan Partners, a 2.4% stake. Luxor Capital has a 10% stake, the second largest of big investors, followed by Wellington Management at 7%.