Seeking Alpha

Arch Coal +3.5% on smaller than expected loss, cost controls improve

  • Arch Coal (ACI +3.5%) moves higher after its Q2 earnings loss came in better than expected as operating costs per ton fell 7%.
  • Q2 sales fell 7% Y/Y to $713.8M, missing analyst consensus, but operating costs per ton fell to $20.55 from $21.19.
  • ACI lowers its FY 2014 sales volume targets, including cutting its thermal sales volumes forecast to 124M-130M tons from 124M-132M tons to reflect the effects of transportation bottlenecks and the impact of a fall in steel production.
  • Other coal names also are higher: ANR +4.3%, ARLP +2.4%, PVA +1.9%, WLB +1.9%, BTU +1.4%, RNO +0.9%, WLT +0.8%, KOL +0.4%.
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Comments (3)
  • Yorick
    , contributor
    Comments (596) | Send Message
    So, let me get this right; ACI loses 46 cents a share as Q2 sales fell 7% but operating costs fell 3% so this is clearly unsustainable. They also lowered volume targets and are closing mines...yeah, but they beat some kid's guesstimate so the stock is up. Nice.
    29 Jul 2014, 01:43 PM Reply Like
  • 6151621
    , contributor
    Comments (1180) | Send Message
    @Yorick. I recommend you look at a chart. The stock is down from $3.60 at the beginning of July. Many were probably trading expecting a miss. Context is critical in trading. The trick is figuring the context that is most relevant. Also, it was near $5.00 around the time of the last earnings call.
    29 Jul 2014, 02:47 PM Reply Like
  • Tueffelhund85
    , contributor
    Comments (189) | Send Message
    Yorick doesn't like coal. Facts are irrelevant.
    8 Aug 2014, 03:16 PM Reply Like
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