SEC filings for the third quarter of 2008 shows some major players have gobbled up large amount of shares in coal companies, as share prices have plummeted along with all commodities.
Two of the biggest companies invested in are Arch Coal (ACI) and Peabody (BTU). Others enjoying large infusions are Consol Energy (CNX) and CVRD, a Brazilian miner of iron ore, Teck and PT Bumi Resources from Indonesia.
Some of the investors involved with acquiring the shares are George Soros, Invesco and Citadel Investment Group.
As of November 21, Peabody traded at 3.7 times projected earnings for 2009 and Arch Coal traded at 2.5 times projected earnings.
Commodity companies will suffer in the short term but over the long haul will surge.
The reasoning behind the acquistions, besides the low valuations, is coal is less apt to be disrupted because of the built-in demand; and that demand is now growing.
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