I don't want to be another smug poster who is certain of the future - because I am not, but . . .
With the buyback being so pro cyclical, there is a risk this stock will not be worth much in a few years time - you might want to share in that part of the booty by taking advantage of the buyback yourself - maybe at least hedging your bets a bit isn't a terrible idea IMO!
Some comments:
1. It will be unusual if coal is not back to normal pricing very soon - look at any historical thermal coal price chart - I put one below - even if the west is constrained from producing more coal - there are a lot of places that will pump out lower quality stuff in huge quantities who will not give a shit about pollution or Paris.
2. This pro cyclical buyback will have paid out a significant proportion of the current huge cashflows to sellers at these high prices - we don't know what the total will be. Are management remunerated based on TSR?
3. There will be some seemingly great franked dividends short term that will probably not go on very long. Marketscreener consensus is predicting $1.74 in divs from 2022 to 2024, but these are obviously based on cashflow projections that may not occur, and buybacks might even be higher than expected -we don't know. Analysts tend to blow with the wind. HODLers will risk only having only crumbs after a dollar or two in divs or whatever.
4. However you will probably still get tea and biscuits at the AGM - if you are starving and can get there ;-)
5. You might sell at the lows just before the next coal boom in a decades time or whenever, when the tax loss looks appealing. Worse you might buy at the highs and sell at lows.
6. Remember that the cure for high prices is . . . high prices!
A coal price chart chart from an old article -
https://www.ft.com/content/b696720f-fed4-4f4b-acbd-302f8935c73e I believe this is in USD - please correct me if not - we know what current prices are. I personally have nothing against coal, the chart heading is not a secret message from me - lol
Nuff said - good luck
(20min delay)