I'm always bemused when the coal companies like CEY get slugged in any market pullback when their earnings are underpinned by long term contracts.
With BHP negotiating coal prices around 116% higher this year compared to last, I can't see CEY, MCC or EXL suffering too much over the next year. All three appeared oversold to me on Friday so I jumped into CEY on the closing bell at $3.78, thinking that would be the low before the bounce. Turned out the after market trades dropped it another two cents but at least it appears to have turned the corner this morning (currently $3.85). It has a long way to rebound given that it traded at $4.30 last month and its prospects certainly look rosy, along with those of the coal industry in general. If anything, the downside is CEY's limited exposure to escalating coal prices unless it is able to ramp up production to take advantage.
Best of luck with your trades.
Gupper
CEY Price at posting:
0.0¢ Sentiment: ST Buy Disclosure: Held
