5 Fossil Fuel Stocks to Invest In for Future

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

Number of Hedge Fund Holders: 44

Arch Resources, Inc. (NYSE:ARCH) is a Missouri-based company that extracts and sells thermal and metallurgical coal from surface and underground mines. On August 30, Arch Resources, Inc. (NYSE:ARCH) declared a $6.00 per share quarterly dividend, consisting of a fixed component of $0.25 and a variable component of $5.75. The dividend was paid to shareholders on September 15. 

Riley analyst Lucas Pipes on July 29 maintained a Buy recommendation on Arch Resources, Inc. (NYSE:ARCH) but lowered the price target on the shares to $221 from $234 after the company reported Q2 adjusted EBITDA of $460 million, falling short of his estimate of $505 million. However, he told investors to take advantage of the recent weakness, noting that Arch Resources, Inc. (NYSE:ARCH) pointed to “a strong preference for buy-backs” and boosted the repurchase authorization to $500 million.

According to Insider Monkey’s database, 44 hedge funds were bullish on Arch Resources, Inc. (NYSE:ARCH) at the end of June 2022, with combined stakes worth $723 million, compared to 45 funds in the prior quarter worth over $1 billion. 

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.”