Why isn’t Whitehaven coal higher?
Hi Team, Why has the coal price been rising but Whitehaven is trading sideways? Thanks, Kim
The Latest Q&A
Answer
Hi Kim,
We feel there’s a couple factors playing out here:
- The market doesn’t want to believe that coal will/can rally, we witnessed a similar scenario with iron ore names before they popped higher.
- WHC has rallied over 20% since mid-September, outperforming the coal price over the same period.
- Some investors may be still sulking that WHC bought BHP’s assets significantly reducing dividend potential in the near term, however, we think this is a good move that greatly enhances the longevity of the business by skewing it towards met coal.
