FDG is not the right sector today, but for a long term hold this thing is cheap.... P/E is less than 5 Yield is close to 12 I was a buying the dip....Any thoughts on why this thing is on sale $COSTAverageMAN
1) It's energy (as you already said) 2) There's a near parallel between coal and nat gas. I think this stock is being punished pretty severely, as you've said, since it has a very low P/E (especially relative to other coal producers) and a better than decent balance sheet. Plus, it's near a 52 week low. I may consider this stock if we get some really cold weather.
Their potential capacity growth is near zero. Just a cash cow with little expansion. Whatever production they are sitting on, that's all they have. At least that the last analysis on this. The stock has been cheap for a very long time. Only true upside on this is consolidation in the industry, which will slowly take place. Even then, not much of a premium will be paid for FDG. Don't forget, it's a trust. It's really a dividend stock rather than a coal stock. BTW, remember PWI, 13.2 yield right now.