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A Coal Stock Worth Buying?

Readers may have noticed that I don't often write about coal stocks. That is because I try my best to be positive, and coal is a hard subject on which to be that way. It is still needed, for sure, but its long-term future in a world of increasing concern about climate control and emissions is uncertain at best. The companies involved in its extraction, processing, and distribution are essentially in a race against time, trying to make the most money they can from their assets before those assets lose all value…not exactly an inspiring background for positivity!

That doesn't mean, though, that there aren't short-term opportunities in coal stocks. Admittedly, the last one I identified, back in January of 2023 wasn't a buy but a short of Peabody (BTU). That worked out okay as the stock dropped from around $30 at the time I wrote the piece to around $20 a short time later, but identifying buying opportunities is a bit harder given that there is always the background of the inevitability of long-term decline. Sometimes, though, the immediate fundamental conditions and a technical look at the chart both point to a short-term pop in a coal stock that is just too good to be ignored.

That is the case right now with Warrior Met Coal (HCC).

As their name implies, they produce metallurgical, or "met" coal for use in smelting of ores and the production of metals like steel. That product focus is the basis of the fundamental case for buying the stock.

Over the…

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Martin Tillier

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