James River Coal provides an economic, though not clean burning, alternative.
James River Coal (NASDAQ: JRCC, Bullboard) has the advantage that, as the price of oil and gas rise, coal has become a more attractive form of energy. It may not be clean burning, but, under the right circumstances, it can be economic.
For the first quarter of 2008, revenue hit $138.2 million, up from $132.4 million in the same quarter a year ago. JRCC produced a net loss of $16.7 million compared with a loss of $7.3 million last year. Some investors might be troubled by the company's $166 million in long-term debt.
The company claims that coal supply currently cannot keep up with demand. Prices support that claim, and over the near term JRCC could benefit substantially. Forbes recently wrote, "With the global demand for coal out-pacing the supply, James River Coal stands to benefit from higher coal prices more than other coal producers because it has the least signed contracts for 2009."
The only thing for investors in JRCC to worry about now is its share price. It recently hit a 52-week high of $33.54. Its 52-week low is $3.56. If the company has anything other than positive news near-term, shareholders are likely to take profits.
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