SOURCE: Paragon Financial Limited

Paragon Financial Limited

December 02, 2011 08:16 ET

Patriot Coal and James River Coal Volatile in the Short Term - Long Term Outlook Strong

The Paragon Report Provides Investment Research on Patriot Coal Corp & James River Coal

NEW YORK, NY--(Marketwire - Dec 2, 2011) - Coal stocks got a sizeable bump earlier this week as physical coal prices rose in line with oil, equities and the euro, bolstered by the dollar's weakness. While the short term bump was welcome for coal investors, a lack of spot demand from China and India has left suppliers struggling to place prompt cargoes already unwanted in Europe. The Paragon Report examines the outlook for companies in the coal industry and provides equity research on Patriot Coal Corporation (NYSE: PCX) and James River Coal Company (NASDAQ: JRCC). Access to the full company reports can be found at:

Coal prices dropped to less than $75 per ton in November on the New York Mercantile Exchange from $85 per ton in August. Earlier this week an analyst at Dahlman Rose & Co said coal companies may slow operations to cut supplies due to the dropping price and rising production costs.

Dahlman Rose & Co. analyst Daniel Scott points out that coal prices have dropped in the US due to competition from natural gas. In the US, natural gas prices remain less than a third of what they were in 2008.

The Paragon Report provides investors with an excellent first step in their due diligence by providing daily trading ideas, and consolidating the public information available on them. For more investment research on the coal industry register with us free at and get exclusive access to our numerous stock reports and industry newsletters.

In the longer term, emerging markets are expected to drive coal demand higher. India's Coal Minister Sriprakash Jaiswal told parliament in New Delhi that the country's annual coal demand may rise 41 percent in the year ending March 2017 from the current financial year. Coal demand is estimated to surge to 980.5 million metric tons from 696 million tons estimated this year, the minister said. Domestic output of coal is expected to rise 28 percent in the period, widening the supply-demand gap to 265.5 million tons, Jaiswal said.

Shares of Patriot Coal Corporation and James River Coal Company both skyrocketed close to 20 percent on Monday. James River Coal Company is one of the leading coal producers in Central Appalachia and the Illinois Basin. The company sells metallurgical, bituminous steam and industrial-grade coal to electric utility companies and industrial customers both domestically and internationally. The company reported a loss of $0.09 per share on sales of $303.9 million in the third quarter, missing EPS estimates by $0.23 and missing revenue estimates by $33.3 million.

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