10 Best Coal Stocks To Buy Now According to Short Sellers

4. Hallador Energy Company (NASDAQ:HNRG)

Number of Hedge Fund Holders: 20

Short % of Shares Outstanding: 3.03%

Hallador Energy Company (NASDAQ:HNRG), headquartered in Terre Haute, Indiana, is a vertically integrated independent power producer. The company operates two main businesses: Hallador Power Company, LLC, which generates electricity, and Sunrise Coal, LLC, which produces and supplies coal to power stations and other customers.

In Q2 2024, Hallador Energy Company (NASDAQ:HNRG) reported a total revenue of $90.9 million, a sharp decline from $161.2 million in Q2 2023. Coal sales dropped to $32.8 million due to a deliberate reduction in coal production as part of Sunrise Coal’s restructuring and lower demand caused by falling natural gas prices.

Net loss for the quarter stood at $10.2 million, a significant shift from $16.9 million in net income the previous year, primarily due to reduced demand for coal and lower dispatch rates at coal-fired power plants.

Despite these setbacks, operating cash flow improved to $23.5 million, up from $18.1 million, aided by cost-cutting measures and operational adjustments. Moreover, Hallador reduced total debt by 41%, raised $27.9 million through an at-the-market (ATM) offering, and converted $11 million of unsecured notes into stock, boosting overall liquidity.

Hallador Energy Company (NASDAQ:HNRG) is restructuring its Sunrise Coal division to improve efficiency by idling higher-cost mines, reducing capital reinvestment, and focusing on low-cost production, aiming for 4.5 million tons of coal annually while cutting 110 jobs.

The stock rose 14.29% over the past month, driven by improved liquidity and restructuring progress. However, the 23.56% YTD decline reflects earlier challenges, including lower coal demand and electricity sales. Notably, a recent $114,000 stock purchase by the company’s director signals confidence in its prospects.

As of Q2 2024, 20 hedge funds with a combined investment of $34.0 million are bullish on the stock, according to Insider Monkey’s database. Additionally, 3.03% of outstanding shares have been sold short.