WHC Chart, page-398

This stock looks oversold based on recent news. Coal prices increasing, with news out of the US and China looking to provide further support on prices.

There is a bit of commentary out of the US about supporting the local mining industry but we have to remember that Whitehaven is a producer of low cost, high quality thermal and coking coal. Whitehaven is in a prime position to generate significant cash flow to repay debt (and speculating, but possibly dividends).

The stock has had a strong run over the past 12 months but it did go through a massive transition in developing and financing Maules creek and IMO was punished unfairly for being a pure coal play. The transition to ramp up at Maules creek has led to better than expected performance in terms of both output and cost of production from the quarterly reports.

On a current earnings multiple basis it is not a great performer.... but I expect this to reverse once the next few quarterly cashflow reports get released and hopefully this will present a step change to earnings and multiple.

In a recently rising coal market, I would and have put my money in to this stock since $0.60~$1.00 as a fair bet that WHC is well positioned to take advantage of quickly rising coal prices. This is levered coal stock play and any large increases (decreases) in coal prices will lead to a multiplied increase (decrease) in equity valuation.