5 Best Coal Mining Stocks To Buy Today

In this article, we discuss 5 best coal mining stocks to buy today. If you want to see more stocks in this selection, check out 11 Best Coal Mining Stocks To Buy Today. 

5. BHP Group Limited (NYSE:BHP)

Number of Hedge Fund Holders: 28

BHP Group Limited (NYSE:BHP) is a resources company that operates in Australia, Europe, China, Japan, India, South Korea, and North and South America. The company operates through three segments – Copper, Iron Ore, and Coal. Its activities include mining various minerals such as copper, silver, zinc, molybdenum, uranium, gold, iron ore, and metallurgical and energy coal. The company was established in 1851 and is headquartered in Melbourne, Australia. It is one of the best coal stocks to invest in. 

On March 13, JPMorgan raised the firm’s price target on BHP Group Limited (NYSE:BHP) to 2,550 GBp from 2,510 GBp and kept a Neutral rating on the shares.

According to Insider Monkey’s fourth quarter database, 28 hedge funds were bullish on BHP Group Limited (NYSE:BHP), compared to 20 funds in the earlier quarter. John Overdeck and David Siegel’s Two Sigma Advisors is the biggest position holder in the company, with 757,100 shares worth $47 million. 

In its Q1 2021 investor letter, Harding Loevner, an asset management firm, highlighted a few stocks and BHP Group Ltd. (NYSE:BHP) was one of them. Here is what the fund said:

“Our purchase of Australian mining company BHP Group Ltd. (NYSE:BHP) is an example of a quality company at a moderate valuation that should deliver attractive long-term returns. We believe the market has undervalued its enduring competitive advantage due to its low cost iron and copper mining operations which has allowed the company to deliver consistent profits and cash flows across the inevitable ups and downs of the global metals cycle. While the variability of commodity prices prevents BHP from scoring in the top ranks of measured quality, we are willing to bear some of that uncertainty in return for a more attractive valuation given the company’s strong business fundamentals.”

4. CONSOL Energy Inc. (NYSE:CEIX)

Number of Hedge Fund Holders: 32

CONSOL Energy Inc. (NYSE:CEIX) mines and sells bituminous coal domestically and internationally. One of its segments, Pennsylvania Mining Complex, is responsible for extracting, processing, and promoting bituminous coal to power generators, industrial, and metallurgical end-users. CONSOL Energy Inc. (NYSE:CEIX)’s CONSOL Marine Terminal segment offers coal export terminal services using the Port of Baltimore. The company is headquartered in Canonsburg, Pennsylvania. On February 7, CONSOL Energy Inc. (NYSE:CEIX) reported a Q4 GAAP EPS of $5.39 and a revenue of $637.15 million, up 32.6% on a year-over-year basis. It is one of the best coal stocks to monitor. 

On January 17, Lucas Pipes, an analyst at B. Riley, decreased the firm’s target price on CONSOL Energy Inc. (NYSE:CEIX) from $85 to $84. However, the analyst maintained a Buy rating on the shares following an update to his metallurgical coal price estimates. Pipes prefers stocks that have a “conservative” balance sheet and “strong” capital return policies to ensure long-term flexibility and options.

According to Insider Monkey’s fourth quarter database, 32 hedge funds were bullish on CONSOL Energy Inc. (NYSE:CEIX), compared to 31 funds in the prior quarter. David Einhorn’s Greenlight Capital is the biggest stakeholder of the company, with 1.8 million shares worth $117.8 million. 

Greenlight Capital made the following comment about CONSOL Energy Inc. (NYSE:CEIX) in its Q4 2022 investor letter:

“As CONSOL Energy Inc. (NYSE:CEIX) rode a surge in coal prices, the shares soared from $22.71 to $65.00 and the company paid $2.05 per share in dividends. In 2022, part of the higher coal prices were absorbed by hedges and forward contracts at what turned out to be below-market prices. Even so, we believe the company ended the year with no net debt. From here, with the below market contracts mostly behind, we expect the higher prices to translate directly into much higher earnings, with most of the free cash flow to be returned to shareholders. Much of the pricing in 2023 and some of the pricing in 2024 is locked in. As a result, we believe that the company will generate free cash flow over the next two years equal to its current market capitalization. While thermal coal will probably never be cool to own, we believe the returns for owning CEIX should continue to be hot.”

3. Arch Resources, Inc. (NYSE:ARCH)

Number of Hedge Fund Holders: 34

Arch Resources, Inc. (NYSE:ARCH) specializes in the production and distribution of metallurgical coal products. Its customer base includes utility, industrial, and steel producers worldwide. The company was established in 1969 and is headquartered in St. Louis, Missouri. Arch Resources, Inc. (NYSE:ARCH) is one of the best coal stocks to invest in. On February 16, the company reported a Q4 GAAP EPS of $23.18 and a revenue of $859.4 million, outperforming Wall Street estimates by $10.29 and $61.03 million, respectively. 

On February 17, David Gagliano, an analyst at BMO Capital, increased the firm’s target price on Arch Resources, Inc. (NYSE:ARCH)’s shares from $185 to $200. The analyst maintained an Outperform rating on the shares following the company’s Q4 results, which exceeded expectations. According to the analyst’s research note, Arch Resources, Inc. (NYSE:ARCH) is well-positioned to provide substantial cash returns to its shareholders in 2023, particularly due to recent price increases in metallurgical coal.

According to Insider Monkey’s fourth quarter database, 34 hedge funds were long Arch Resources, Inc. (NYSE:ARCH), compared to 38 funds in the earlier quarter. 

Here is what Kingdom Capital Advisor specifically said about Arch Resources, Inc. (NYSE:ARCH) in its Q2 2022 investor letter:

“Arch Resources, Inc. (NYSE:ARCH): When we began following Arch, we focused on their metallurgical coal segment and viewed their thermal coal segment as a source of potential upside. However, especially since Russia’s invasion of Ukraine, energy security has surged into focus and Arch’s thermal operation now faces higher spot prices than their met sales. Arch retired most of their convertible debt during Q2, another example of their strong commitment to delivering shareholder value. Estimates for Q2 suggest Arch should earn over $20/share vs a $130 share price, and they remain committed to distributing half of their cash flow via dividends.”

2. Peabody Energy Corporation (NYSE:BTU)

Number of Hedge Fund Holders: 40

Peabody Energy Corporation (NYSE:BTU) operates in the coal mining industry across the globe, including the United States, Japan, Taiwan, Australia, India, Brazil, Belgium, Chile, France, Indonesia, China, Vietnam, and South Korea. The company’s operations are divided into several segments, including Seaborne Thermal Mining, Seaborne Metallurgical Mining, Powder River Basin Mining, and Other U.S. Thermal Mining. Its main customers include electricity generators, industrial facilities, and steel manufacturers. Peabody Energy Corporation (NYSE:BTU) was established in 1883 and is headquartered in St. Louis, Missouri. 

On January 17, Lucas Pipes, an analyst at B. Riley, increased the firm’s target price on Peabody Energy Corporation (NYSE:BTU) from $37 to $39. The analyst maintained a Buy rating on the shares following an update to his metallurgical coal price estimates. Pipes continues to favor stocks with a “conservative” balance sheet and “strong” capital return policies to ensure long-term flexibility and options. 

According to Insider Monkey’s fourth quarter database, 40 hedge funds were long Peabody Energy Corporation (NYSE:BTU), compared to 38 funds in the prior quarter. Paul Singer’s Elliott Management is the largest stakeholder of the company, with 23 million shares worth $608.3 million. 

1. Teck Resources Limited (NYSE:TECK)

Number of Hedge Fund Holders: 62

Teck Resources Limited (NYSE:TECK) explores for, acquires, develops, and produces resources in North America, Europe, and Asia. The company operates through four segments – Steelmaking Coal, Copper, Zinc, and Energy. It was established in 1913 and is based in Vancouver, Canada. On February 21, Teck Resources Limited (NYSE:TECK) declared a C$0.125 per share quarterly dividend, in line with previous. The dividend is payable on March 31, to shareholders of record on March 15. Apart from the dividend, the board of directors has given permission to the management to buy back up to $250 million worth of Class B subordinate voting shares.

On March 14, Scotiabank analyst Orest Wowkodaw raised the firm’s price target on Teck Resources Limited (NYSE:TECK) to C$75 from C$70 and kept an Outperform rating on the shares.

According to Insider Monkey’s fourth quarter database, 62 hedge funds were bullish on Teck Resources Limited (NYSE:TECK), up from 47 funds in the prior quarter. John Armitage’s Egerton Capital Limited is the largest stakeholder of the company, with 11.4 million shares worth $431 million. 

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