| Arch Coal (ACI) Cuts Corners to Cope with Coal Depression | |
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We updated our research report on Arch Coal Inc. ACI on Aug 18, 2015. The company is striving to cut costs and reduce capital spending to withstand the difficult coal fundamentals. Arch Coal’s Leer and West Elk mines are aiding the company to cut costs besides offering an improved quality of coal.
Arch Coal nonetheless expects U.S. coal demand in 2015 to decline compared with last year and it is likely to face stiff competition from Australian coal operators due to their locational advantage.
In spite of adopting various measures, an over-supplied global metallurgical coal market and competition from low-cost natural gas resulted in yet another wider-than-expected loss at Arch Coal in the second quarter of 2015. Revenues also missed the estimates and declined year over year.
The combined effect of competition from cheaper natural gas and regulatory mandates to cut carbon emissions is likely to reduce domestic coal demand and hence shipments. Per the U.S. Energy Information Administration release, coal production in 2015 is expected to decline by 75 million short tons.
However, Arch Coal is striving to reduce operational cost and lowering planned investments to counter the coal downturn. The company’s economical Leer and West Elk mines have helped it to maintain the cash cost guidance in the range of $56.75 to $59.75 per ton for 2015.
Moreover, Arch Coal has operations in all major coal producing regions of the U.S. which allows it to ship and supply coal to a wide range of customers. The company is also tapping the growing demand for coal in the Asian countries.
This St. Louis, MO-based company recently went for a one-for-ten reverse stock split to maintain the listing of its common stock on the New York Stock Exchange.
Zacks Rank
Arch Coal currently has a Zacks Rank #3 (Hold). Better-ranked stocks in the broader energy space include Alon USA Energy, Inc. ALJ, Deep Down, Inc. DPDW and Seadrill Partners LLC SDLP. All three stocks currently sport a Zacks Rank #1 (Strong Buy).
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Arch Coal Inc
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PRODUCER |
CODE : ACI |
ISIN : US0393801008 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Arch Coal is a coal producing company based in United states of america. Arch Coal holds various exploration projects in USA. Its main assets in production are WEST ELK, BLACK THUNDER and JACOB'S RANCH in USA and its main asset in development is SPRUCE N° 1 in USA. Arch Coal is listed in Germany and in United States of America. Its market capitalisation is US$ 366 000 as of today (€ 317 981). Its stock quote reached its highest recent level on June 27, 2003 at US$ 99.96, and its lowest recent point on October 04, 2018 at US$ 0.01. Arch Coal has 36 600 000 shares outstanding. |