Monday, November 24, 2008

George Soros: Green Schmeen, I'm Buying Arch Coal (ACI)

From MarketWatch:

Coal producers rally as investors wade in

...Public filings disclosed investments in these and other coal producers. Soros Fund Management LLC, the investment arm of billionaire George Soros, bought 2.9 million Arch Coal Inc. shares in the last quarter, according to a 13F filing.
From Bloomberg:

Arch Coal Attracts Soros as Peabody Lures Citadel
Billionaire investor George Soros, Citadel Investment Group LLC and T. Rowe Price Group Inc. are snapping up coal mining shares, taking advantage of the cheapest valuations in five years as demand for electricity rises.

Soros bought 2.9 million Arch Coal Inc. shares last quarter for a 2 percent stake in the second-largest U.S. coal producer, filings with the Securities and Exchange Commission show. Citadel, the Chicago-based hedge fund, and Invesco Ltd. in Atlanta bought 3.5 million shares of Peabody Energy Corp., the biggest miner. T. Rowe reported purchasing stock in Peabody, Arch, Consol Energy Inc. and Indonesia’s PT Bumi Resources.

While coal, the cheapest fuel for power, is up 88 percent in Pennsylvania, shares of the companies that mine the mineral have slumped along with the rest of the commodities industry. Now, investors are betting that Peabody, which traded at 3.7 times projected 2009 earnings as of Nov. 21, and Arch at 2.5 times are cheap because coal use will increase. The valuations were at more than a 54 percent discount to the MSCI World/Energy Index...MUCH MORE