Wave of
bankruptcies seen for U.S. coal industry, analyst warns
Carl
Surran, SA News Editor
- The outlook for U.S. coal producers is "increasingly
bleak," and the sector is likely to undergo a wave of
bankruptcies, Macquarie Research warns as it forecasts U.S. coal prices
(NYSEARCA:KOL) will no longer move in conjunction
with international coal prices.
- The decoupling, which will feature declines in U.S.
coal prices, will be a "necessary step to force rationalization on
U.S. producers" but also likely will result in production cuts and
bankruptcies over the near-to-medium term, says analyst Anthony Young.
- Peabody Energy (NYSE:BTU) recently had to pay a 10% interest
rate on bonds it issued, which Young says bodes badly for other coal
producers, making it harder for to refinance debt and leading to cuts and
liquidity squeezes.
- Macquarie lowers its stock price targets on Alpha
Natural (NYSE:ANR) to $0.60 from $1.15, on Arch Coal (NYSE:ACI) to $0.90 from $1.25, on BTU to $5.30 from $6.40, and
on Consol (NYSE:CNX) to $29.50 from $31.50.
Quelle: bigcharts.com
Quelle: bigcharts.com
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