Hi @KunisagiI think it is a pretty good buy at these prices, not...

Hi @Kunisagi

I think it is a pretty good buy at these prices, not that I own any WHC shares.

I haven’t looked at Financials in detail, however here are some key points that make the investment pretty compelling:
1. Debt reduced from $918M to $167M
2. EPS pre-abnormals, $1.95, PE Ratio 4.3 times
3. $1.2B in cash at bank, from under $100M the prior year
4. Revenue has almost doubled in 3 years

At a Macro level, electricity generation using coal will not reduce anytime soon and is increasing globally. This is likely to extend further over the Northern Hemisphere winter. Sensible economic forces would dictate nuclear use in dormant stations across Europe (Germany in particular), however politics is trumping common sense.

Historically I had invested in a company called Macarthur Coal in 2002 which specialised in Thermal Coal exploration and mining. I sold out in early 2007 thinking prices couldn’t go any higher (also to buy my current family house). Little did I know share price was yet to triple during peak price and a takeover battle.

Here is the long term Thermal coal chart in USD:


Point being, look for WHC share price to go higher. Korean and Japanese companies could easily swoop in and purchase WHC in a large takeover. Current prices are very cheap. One would easily see a takeover at 12 to 16 times earnings, more than tripling current share price.

If anyone has any further information on WHC they would care to share. I am not sure why Revenue has increased so rapidly (possibly a mine has come on line). Would not have thought Coal price increase solely responsible.

Best of Luck
Lost