Bookkeeping: Restarting James River Coal (JRCC)

Submitted By Trader Mark
James River Coal (JRCC) is smaller than the "headline" coal stocks but is among the cheapest with a very surprising earnings report at the beginning of the month. In one of the worst trades of the year I closed out JRCC from the portfoli o March 17th before "reflation" was cool at $11. [Mar 17: Bookkeeping - Closing James River Coal] The chart stunk as the stock was below all key moving averages...

(THEN)

Now however, the story is completely different as the stock is above all key moving averages.

(NOW)

And I missed a good 100% run. Within a few days of when I sold the stock jumped back over the 50 day moving average - then went sideways as the overall market screamed higher (which to me is "bearish") but then the earnings report seemed to surprise all observers. As always, technical analysis and price action is just a tool, not an all knowing provider of outcomes. In this case there was nothing in particular to let us know from $14s to $22s would happen within a handful of sessions.

We've been noting how coal is "hot" of late [May 20: Market Vectors Coal (KOL) Red Hot], and frankly JRCC is still dirt cheap compared to peers and always a candidate for a buyout offer. What I like about this technical set up is we are just above multiple support and if the thesis of the day turns away from "reflation" to whatever the next thesis is, we can cut back with a very defined spot.

I started a 1.9% stake here in the upper $20 range. Comparing earnings estimates is fraught with danger among coal companies because some rely on thermal coal, some metallurgical, some are heavily exposed to the spot market, and others have a lot of longer term contracts but JRCC is generally expected to print over $3 in earnings both in 09 and 10. Larger peers are generally trading (I am looking out to 2010 since 2009 estimates in flux) at about 11-12x 2010 estimates; obviously you can do the simple math and see if JRCC were valued the same it would be >50% upside. Being a smaller player I don't expect that gap to fill completely but if the variance closes there could be an opportunity there.

That said, as any reader of mine knows - when people yell fire and all commodities sell off none of this analytic talk will matters - the student body will run right, and all stocks in the commodity space will be sold off in the same direction. But I still like to pretend individual company metrics mean something rather than the only thing mattering being program trading by computers.

A quick look at earnings that helped to set the stock off (along with the recent love of all things commodities)

(May 1) James River Coal Co's (JRCC) quarterly profit beat expectations, boosted by a 73 percent jump in the average price of Central Appalachian coal (CAPP), but said it would cut production due to the softness in coal demand. The results pushed James River's shares up 26 percent.
CAPP average sales price rose to $90.91 per ton, compared with $52.56 per ton in the year-ago quarter, driven by new contracts signed by the company in 2008.
Revenue at the Richmond, Virginia-based coal producer rose 39 percent to $192.1 million.
In a conference call with analysts a company executive said James River cut production on Saturdays, stopped purchase of coal and idled most of its contract mines. It also plans to reduce capital expenditure as part of its cost-savings.
For 2009, the company has about 6.7 million tons of coal priced at $89 per ton. It lowered the price of a 700,000 ton contract to $70 from $108 and will re-adjust the amount for supplies in 2010-12. "The company... essentially gave up a little value on its 2009 contracts in order to get more value in 2010-2012. This is a strategy that we think makes a lot of sense for the company," said analyst Jeremy Sussman of Natixis Bleichroeder.
"This should help discount any theory that James River is just a 'one-year wonder'," the analyst added, referring to the company's contract position for 2009 and 2010.
James River Coal, which operates in the Central Appalachian basin of the United States, mines and sells bituminous, steam and industrial-grade coal in Kentucky and Indiana.

Long James River Coal in fund; no personal position

Did you like this article?

Login or register to post comments
Email this page
Reset vote
1 point

Guess was established in the

Submitted by erye on Thu, 03/11/2010 - 8:44pm.

Guess was established in the early '80's and mbt tunisha has since become one of global lifestyle brands. Today,guess handbags outlet, markets and distributes full collection of women,mbt lami birch men and children's apparel, as well as guess handbags outlet and accessories. Many women consider this Designer handbags outlet, Guess purses and Guess bags as among the "must have" items in their wardrobe.nike air max 95 At present,nike air max handbags are not just fashion statements anymore.nike air max 360 Bags must be large,2009 air max sturdy and functional to support the needs of the modern woman.mbt lami birch It is not unusual for women to more than one bag. air max 2003 A vital necessity for one bag is not adequate to carry everything she needs.nike air max 2010 Guess handbags are trendy that complements every fashion-conscious woman's lifestyle.nike air max 95 Most retail stores sell Guess purses between nike air max 90, making this an affordable nike airmax 95.

Shop online for authentic

Submitted by ugg mbt on Sun, 02/21/2010 - 10:41am.

Shop online for authentic luxury Porsche Design Watches,wholesale Burberry Handbags,wholesale rolex watches,Accessories including PTC 911,wholesale Nike Shox Shoes,mbt shoes,wholesale Dolce Gabbana Handbags,wholesale Louis Vuitton Handbags,Flat Six,wholesale ed hardy,wholesale rolex watches,Indicator at our website,porsche design watches,wholesale jordan shoes,nike air max 2009,The biggest brand discount website!

If you are looking for the

Submitted by Ecboots on Thu, 02/18/2010 - 9:39pm.

If you are looking for the top boots such as timberland boots sale,christian louboutin shoes, uggs on sale,puma shoes ,high quality, Quick shipment,Lowest price and Good service. Many people care their health.To have a good MBT shoes, will help reduce the anxious.when you see mbt shoes sale, you can find timberland boots sale, christian louboutin sale and puma shoes sale, no matter which you like, there are some other styles, like timberland 6 inch boots, ugg bailey button,ugg argyle knit boots,timberland boots mens,timberland roll top boots, mbt lami shoes.these shoes make you so fashion in cold winter. Also,you can take a look the designer handbags,such as gucci handbags,chanel handbags, Louis Vuitton Handbags and so on.

puma shoes |puma speed

Submitted by xuxiangfei on Wed, 02/03/2010 - 10:20pm.

Your guide to Discount

Submitted by erye on Mon, 02/01/2010 - 12:22am.

Your guide to Discount Designer Sunglasses Online including exclusive deals on Chanel Sunglasses, We are the direct manufacturer of classic chanel sunglasses provides you with wholesale,Gucci Sunglasses offer a large selection of wholesale replica sunglasses and wholesale Prada Sunglass,include ray ban sunglasses,Freepost Returns on all Sunglasses sale is a great source for sunglasses on Discount sunglasses sale.

Christian Louboutin Sale

Submitted by fan on Fri, 01/29/2010 - 1:19am.

Christian Louboutin Sale

As the climate is colder and colder, many more warm boots fight against cold. Christian Louboutin Boots avariable in worldwide, have become femininity, hight quality and nice design for women. So Christian Louboutin boots are very popular. Getting a pair of Christian Louboutin that is dream of every girl.
Christian Louboutin Shoes have peep toe, signature red leather sole will help you show your taste. They are sexy, gorgeous and fun. The designers ' national spirit, is " make shoes that are like jewels" and each unique design demonstrates an unparalleled degree of quality and a born sultriness. Christian Louboutin Shoes desined with leather lining,round toe, concealed platform,hidden heel and signature red sole,which will bring much confidence and comfort and make you more beautiful.
However, if you purchase online, you will find a couple of Christian Louboutin begins at a fraction of the price of the originally price, you should be aware that buy Christian Louboutin online can save your money. One began the discount Christian Louboutin and is payment have been offered in goodugg.net store.
Look at the Christian Louboutin! What a slender and graceful line! Ladies are crazy about it. If you are engaged in the vogue or you want keep the same pace with the trend. Christian Louboutin Sale could be your best choice.

We supply nfl jerseys,cheap

Submitted by cheap nfl jerseys on Thu, 01/28/2010 - 12:15pm.

We supply nfl jerseys,cheap nfl jerseys,wholesale nfl jerseys,nfl youth jerseys wholesale,bears jerseys.All kinds of jerseys are on sale jersey shirts,Buy wholesale nfl jerseys, baseball jersey products limited edition. free shipping and accept credit card online authentic jersey.

We guarantee goods' world

Submitted by GGG on Thu, 01/21/2010 - 3:43pm.

We guarantee goods' world first class quality and competetive price, have an extensive selection of louis vuitton neverfull,and all of our handbags are with high quality. Welcome to luis vuitton Online Store. At QualityReplicaHandbags.com our perfectionism pays off. Our obsession with detail and skilled craftsmanship means the louis vuitton speedy are exquisite imitations flawlessly cut.

cheap uggs for sale Ugg

Submitted by cheapmbt on Mon, 01/18/2010 - 10:47am.

cheap uggs for sale Ugg Boots ugg boots cheap uggs on sale cheap ugg boots online ugg boots sale uggs on sale Ugg Bailey Button Ugg Classic Boots Uggs on sale cheap ugg boots ugg boot cheap uggs ugg UGG Cardy boots UGG Classic Crochet UGG Classic Mini UGG Classic Short UGG Classic Tall UGG Coquette Slipper UGG Lo Pro Button UGG New Style Boots UGG Nightfall UGG Rainier Eskimo UGG Sundance UGG Ultra Short UGG Ultra Tall ugg australia boots bailey boots bailey button boots button boots cardy boots cardy boots sale classic short boots classic short boots sale classic tall boots Ugg Bailey ugg bailey boots Ugg Bailey Button Boots ugg button boots UGG Cardy ugg cardy boots ugg cardy sale UGG Classic Cardy boots UGG Classic Cardy sale ugg classic short sale UGG Classic Tall ugg classic short boots ugg classic tall boots ugg classic tall sale ugg short boots ugg short boots sale ugg tall ugg tall boots ugg bailey black Ugg Bailey Button Chocolate Ugg Bailey Button sand ugg classic cardy boots grey ugg classic cardy cream UGG Classic Cardy grey ugg classic cardy oatmeal ugg classic short black ugg classic short grey ugg classic short paisley UGG Classic Tall black ugg classic tall chestnut UGG Classic Tall chocolate UGG Classic Tall sand

mbt mbt trainers mbt

Submitted by lily0804 on Tue, 01/12/2010 - 8:35am.

mbt
mbt trainers
mbt schuhe
mbt sale shoes
mbt sale
mbt shoe
mbt shoes review
mbt shoes clearance
walking shoes
mbt walking shoes
mbt shoes uk
mbt reviews
mbt shoes
mbt shoes on sale
cheap mbt shoes
mbt shoes for sale
anti shoes
mbt anti shoes
mbt chapa shoes
mbt m.walk grey
mbt m.walk pink
mbt m.walk black
mbt m.walk peachblow
mbt lami
mbt lami shoes
mbt lami sale
mbt lamis
mbt lami purple
mbt sport
mbt sport 2
mbt sport
mbt sport shoes
air jordan shoes air jordan nike shoes nike jordan shoes nike jordan jordans shoes jordans michael jordan shoes michael jordan Jordan basketball shoes cheap jordan shoes jordan shoes on sale Jordan Fushion Shoes discount jordan shoes mens jordan shoes mbt m.walk pink
mbt m.walk black
mbt m.walk peachblow
mbt lami

london links links london

Submitted by aiyamaya on Fri, 01/08/2010 - 11:12pm.

london links
links london jewellery
links of london
love links jewellery
love links
links bracelet
links bracelets
links bracelets london
links bracelets cheap
links bracelets for men
links charms
links charms sale
love links charms
links jewellery
links of london usa
links of london sale
links of london wholesale
links jewellery sale
links jewellery wholesale
tiffany co
tiffany and co
tiffany rings
tiffany jewelry
tiffany & co
tiffany jewellery
tiffany engagement rings
engagement rings
tiffany uk
tiffany ring
tiffany ring on sale
tiffany ring for sale
tiffany ring for men
ugg bailey boots Ugg Bailey Button Boots Ugg Bailey Button ugg button boots Ugg Bailey UGG Classic Cardy boots Cardy boots UGG Cardy boots UGG Cardy sale ugg classic short sale ugg short boots ugg classic short ugg classic tall Boots ugg tall ugg tall boots ugg classic tall mbt m.walk peachblow
mbt lami

Nice contribution.

Submitted by aiyamaya on Mon, 01/04/2010 - 8:32pm.

Nice contribution. Thanks. cheap ugg boots Ugg ugg australia boots Ugg Boot Ugg Boots ugg boots on sale Ugg Boots Sale ugg on sale Ugg Sale Uggs bailey boots bailey button boots button boots Cardy boots Cardy boots sale classic short boots classic short boots sale classic tall boots Ugg Bailey ugg bailey boots Ugg Bailey Button Ugg Bailey Button Boots ugg button boots UGG Cardy UGG Cardy boots UGG Cardy sale UGG Classic Cardy boots UGG Classic Cardy sale ugg classic short ugg classic short sale ugg classic tall ugg classic short boots ugg classic tall Boots ugg classic tall sale ugg short boots ugg short boots sale ugg tall ugg tall boots ugg bailey black Ugg Bailey Button Chocolate Ugg Bailey Button sand ugg classic cardy boots grey ugg classic cardy cream UGG Classic Cardy grey ugg classic cardy oatmeal ugg classic short black ugg classic short grey ugg classic short metallic ugg classic short paisley UGG Classic Tall black ugg classic tall chestnut UGG Classic Tall chocolate UGG Classic Tall metallic UGG Classic Tall sand

uggs on sale Ugg Classic

Submitted by 1uggclassic on Wed, 12/30/2009 - 9:51am.

uggs on sale Ugg Classic Tall Boots Ugg Classic Cardy Boots Ugg Boots Classic Cardy Ugg Classic Cardy Ugg Classic Short Boots Ugg Classic Mini Boots Ugg Classic Mini Ugg Classic Short nike air force ones nike air force one shoes nike air force one cheap nike air force ones nike air force 1 low nike air force 1 mid nike air force 1 nike af1 buy nike air force one discount nike air force one women's air force one

Largest selection of

Submitted by ergrewew on Mon, 12/14/2009 - 8:19pm.

Largest selection of discount cheap timberland boot, Saving a lot at our Timberland boots for men Outlet Store of timberland boots uk timberland boots timberland shoes timberland boots sale cheap timberland boots timberland in uk timberland chukka boots timberlands uk timberlands on sale timberland waterproof.We assure you of our Best Services at all times. Tiffany Bracelets Tiffany Necklaces Tiffany Earrings Tiffany Set Tiffany Bangles Tiffany Rings ugg slippers ugg chocolate boots ugg boot sale Cheap ugg boots discount ugg boots ugg boots chestnut classic tall uggs

Gucci glasses frame Prada

Submitted by love8382 on Mon, 12/14/2009 - 4:37am.

Gucci glasses frame Prada glasses Prada eyeglasses Prada prescription glasses Prada glasses Prada glasses frame MaxMara glasses MaxMara eyeglasses MaxMara prescription glasses MaxMara glasses MaxMara glasses frame

to provide the best louis

Submitted by dsfsdaj on Tue, 12/08/2009 - 5:55am.

to provide the best louis vuitton replica products and service to our customers at the lowest prices possible. All of our replica handbags are made to look and feel just like the originals. No one will be able to tell you’re carrying one of our replica handbags, because our imitation LV bags are identical to the real thing. The replica louis vuitton handbags,bags,purses and clutches in our online shop has three advantage.