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Investor Guide To Coal Companies In 2015

The U.S. Coal Industry has been facing tough business conditions, as environmental regulations, lower natural gas prices and weak global economic conditions have led to soft coal market fundamentals. U.S. coal companies did not have a good start to 2015, as four leading coal companies, Alpha Natural Resources (NYSE:ANR), Arch Coal (NYSE:ACI), Peabody Energy (NYSE:BTU) and Walter Energy (NYSE:WLT), lost a significant proportion of their market capitalizations. A weak global economic outlook and the recent strengthening of the U.S. dollar against major coal exporting countries like Russia and Australia have put pressure on stock prices of coal companies in recent times. U.S. coal companies are trying their best to control the factors, which they can, to survive the industry downturn. I believe U.S. coal companies will undertake incremental measures to reduce costs and announce additional supply cuts during their 4Q'14 earnings call, starting next week, to address the prevailing industry challenges, which could positively affect their stock prices in the near term. However, the long term survival of the companies is dependent on a coal price recovery. The following graph shows the stock price performances of the four aforementioned coal companies in 2015, year-to-date. (click to enlarge) Source:…