Patriot Coal Corporation (OTCQB:PCXCQ) is a producer and marketer of coal in the eastern United States - and it's also bankrupt. While I believe that an interesting way to speculate on Patriot's turnaround (albeit highly risky) is to actually own the bonds (convertible debt trades at $0.10 on the dollar, senior debt worth $0.48 on the dollar, and even the debtor-in-possession notes trades slightly below par), the recent doubling of the soon-to-be worthless equity is mind-boggling.
This Business Is In Significant Trouble
It was recently announced that the federal appeals court would keep Peabody Energy (BTU) (Patriot's former parent company) on the hook for the health benefits of about 3,100 retired Patriot Coal miners, which actually turned out...
|FREE||SA PRO MEMBERS|
|IDEA GENERATOR||X||Exclusive access to 10 PRO ideas every day|
|INVESTING IDEAS LIBRARY||X||Exclusive access to PRO library of more than 15,000 ideas|
|SECTOR EXPERT NETWORK||X||Exclusive access to all sector experts for direct consultation|
|PERFORMANCE TRACKING||X||Track performance of all PRO stock ideas|
|PROFESSIONAL TOOLS||X||Professional Idea Filters to zero-in based on industry, market cap and more|