Black Bear Value Partners, an investment management firm, published its fourth-quarter 2024 investor letter. A copy of the letter can be downloaded here. Black Bear Value Fund returned -9.4% in December and -1.4% in 2024 and the S&P 500 returned -2.4% in December and +25.0% in 2024. HFRI Value Index returned -1.2% in December and +11.5% in 2024. In addition, please check the fund’s top five holdings to know its best picks in 2024.
Black Bear Value Partners highlighted stocks like Core Natural Resources, Inc. (NYSE:CNR) in its Q4 2024 investor letter. In January 2025, Core Natural Resources, Inc. (NYSE:CNR) was established through a merger between Arch Resources and CONSOL Energy. Core Natural Resources, Inc. (NYSE:CNR) engages in the production and distribution of bituminous coal. The one-month return of Core Natural Resources, Inc. (NYSE:CNR) was -5.92%, and its shares gained 1.93% of their value over the last 52 weeks. On January 24, 2024, Core Natural Resources, Inc. (NYSE:CNR) stock closed at $96.73 per share with a market capitalization of $5.16 billion.
Black Bear Value Partners stated the following regarding Core Natural Resources, Inc. (NYSE:CNR) in its Q4 2024 investor letter:
“Core Natural Resources, Inc. (NYSE:CNR): Both ARCH and CEIX were down ~18% during the month of December as fears of retaliatory tariffs (these have a large export component to their businesses), economic slowing and likely tax-loss selling drove the stocks lower. Like our discussion on BLDR, the long-term story remains intact, and we used this as an opportunity to further concentrate our investment. Due to their impending merger neither Company can buy back their stock. Once the merger is complete in Q1 there should be abundant cash to buy back stock. I am generally constructive on the merger as the Companies should be able to realize some modest synergies. My sense is more mergers will be coming to this sector given the depressed prices of the securities.
ARCH is one of the leading U.S. producers of high-quality metallurgical coal (“met coal”). This is the kind of coal used for steelmaking. ARCH also has a thermal coal business that contributes ~20% of their earnings. CONSOL is a leading producer of thermal coal.
Met coal demand is projected to climb for the next 25 years, driven by the economic development and urbanization in India and the rest of Southeast Asia. ~60% of the world’s population lives in Asia, where met coal demand is centered and where local sources are limited. Over the coming years demand will likely outstrip supply, leading to higher prices. There has been a severe lack of investment in met coal due to ESG concerns with investment peaking in 2014…” (Click here to read the full text)
A large coal mining complex on a sunny day, with heavy machinery moving vast amounts of earth.
Core Natural Resources, Inc. (NYSE:CNR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the potential of Core Natural Resources, Inc. (NYSE:CNR) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In another article, we discussed Core Natural Resources, Inc. (NYSE:CNR) and shared the list of stocks Jim Cramer recently shed light on. In addition, please check out our hedge fund investor letters Q3 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.