jump to navigation

(FDG) FORDING CDN COAL has great dividend yield, cheap P/E and amazing growt rates. July 13, 2006

Posted by deminvest in Defensive Stock, FDG Foding Canadian Coal, investment, stocks that pay high dividends.
trackback

Frank Galotti’s comment on the (PVR) Penn Virginia Resource article pointed out what a bargain is FDG.

I checked and found that PVR has:

  1. P/E = 5.25
  2. Dividend Yield = 11.60%
  3. Qtrly Revenue Growth yoy = 64%
  4. Qtrly Earnings Growth = 154%
  5. Debt of only 305.72M which is very low compared to sales of 1.84B
  6. Its business with coal is excellent in times of high energy prices.

Thank you again to our fellow investor friend for pointing out this golden eggs chicken that for some reason is so cheap.

I ordered 50 of them at market opening at any price. It is a way to wspread some optimism in this beaten up market and on this stock which is left behind. I will maybe pay it a bit more, but will show investors that there is someone willing to buy FDG at any price. If many other proletarian investor placed an order of that kind the stock would skyrocket and professionals would have to follow us. El Pueblo unido jamas sera vencido! But that is only a dream for the future. The people which will buy good stocks, without letting the Wall Street big guys decide for us.

Comments»

1. len - July 13, 2006

hi vado!

i was gonna ask what fgd was… i thought it was a tire unit or something but before i could even ask it seems u’ve read my mind so it’s a company mr galotti mentioned. anyway, thanks for this update on ur blog. i thought u had a long vacation and i missed ur blog.

2. deminvest - July 13, 2006

Len,

It is a great canadian coal producer. I bought 50 of them at USD 30,2 each. I am writing less now because I am not very excited of this market situation. I try to invest only $1000 a month and buy only one stock a month. I consider FDG coal mines so interesting that I bought $ 1,500 of it, which more than I had planed. What about you? Are investing, selling or just looking at the market lately?

3. deminvest - August 14, 2006

My mistake.
I wrongly connected FDG to extremely healthy energy markets, as you point out its coal has to be used for steel production and that is a totally different story.

4. len - July 14, 2006

hi vado!

just like you am not so happy with the market unlike some two years back that there were some exciting markets in the asia but now i think we have to be extra cautious. so am still on the wait and see on the markets and other opportunities for investment. thanks for this blog of yours this gives me some idea on some areas that others would not dare to tread. good luck vado and thanks retirein for those tips.

5. monthlydivs - August 5, 2006

Why FDG unit price has gone down?

1) Met coal contract price in 2006 is lower than 2005
met coal contract price.

2) FDG has not been able to increase production volume
of met coal in 2006 versus 2005.

3) Production costs are rising for each ton of met coal
produced & sold.

4) Some FDG customers either delayed or cancelled met
coal orders from FDG.

5) Most likely in 2007 and 2008, we will be seeing increased
supply of met coal coming on world markets from Australia
& other countries. (Maybe putting pressure on met coal
contract prices?)

So we have a company with lower selling prices, higher cost
of goods & lower production & sales. That means FDG will
not be generating the same levels of cash flow in 2006 that it
was in 2005 and thus the reducton in quarterly FDG distributions.
As FDG quarterly distributions were reduced, some FDG investors
sold which then put “selling pressure” on FDG unit price driving
it down.

Hope that summarizes what has been happening with FDG.
I think the “risk” on FDG is somewhat reduced if an investor
is able to purchase FDG units at $25 price level. If a person
purchased FDG at $40 price level, I think they will be waiting
a long time for FDG to get back up to $40 price level. My hunch
is FDG will sell between $25-$28 until next quarterly FDG
distribution announcement.

MD

6. Fording Canadian Coal (FDG) hit my 40% up target in such hard times! « Democratic Investments by the people for the people - February 1, 2008

[…] trackback on  July 13, 2006 I bought  50 FDG at USD 30.2 each spending a total amount of $1510.  I wrote why I chose Fording Canadian Coal right on this Blog. I’m surely glad of my […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: