Discussion in 'Stocks' started by $CostAverageMAN, Oct 4, 2006.

  1. 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

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  2. 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.
  3. 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.
  4. without starting a new thread...I resurected an old one. FDG getting bought out, nice move today.