According to the U.S. Energy Information Administration of the U. S. Department of Energy, 30% of the electricity generated in the United States comes from coal.
This is a significant source of fuel for generators, primarily due to its low energy production costs compared to natural gas and petroleum.
Some investors believe that the United States withdrawal from the Paris Agreement and the energy policies of the current administration should help coal stocks. If that happens, there are several American coal companies that could benefit.
Arch Coal (ARCH), which is headquartered in St. Louis, Missouri, was founded in 1969. The stock trades at 15.6 times forward earnings and pays a small yield of 0.5%. It has a favorable price sales ratio of 0.8. Revenues for the latest quarter jumped 45% year-over-year. Earnings per share went from a negative $9.71 to a positive $2.03 over the same period.
Cloud Peak Energy (CLD) is a low priced and low market cap stock, which is based in Gillette, Wyoming. The price to earnings ratio is a reasonable 5.4 and the price to sales ratio is an auspicious 0.3. The company does not pay a dividend.
Westmoreland Coal (WLB) has an even smaller market capitalization of $100 million. The company is based in Colorado Springs, Colorado, and is not currently generating positive earnings, nor does it pay a dividend.
Maybe coal can heat up your portfolio, but be careful, as many believe that the coal industry is a dying industry.
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