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Consol Coal: Recent Dip Provides A Good Opportunity To Buy This 13% Yielding Stock

Published Tue, 30 Jul 2019 12:01:41 -0400 on Seeking Alpha

Thesis
Consol Coal Resources (CCR) has lost ~20% in price during the past nine months and currently trades at the lower end of its 52-week range. Besides, the stock is also way below its 50-day and 200-day SMA. CCR is a 13%+ yield North American coal pure-play that provides the tax advantages of an MLP and has a strong business model that enables it to generate stable cash flows. This provides an interesting opportunity for income investors to plant a high-yield stock in their portfolio that is quite likely to witness price recovery in the near term.
CCR's main challenge is to maintain its dividend payments while simultaneously deleveraging its balance sheet. Fortunately, the company seems to be doing well on both scores. A competitor analysis indicates that CCR offers a better investment opportunity than its peer. Let's get into the details.
Figure-1 (Source: CONSOL Coal)
Technical aspects
CCR currently boasts a dividend yield of 13% at current prices. The technical price chart shows that CCR's share price has formed a wedge pattern (Figure-2). The share price has had a dip from ~$19 in February to the current levels of under $16. The stock has largely moved sideways since June 2019, but it has begun to show signs of revival. On a different note, CCR's current prices also post an attractive buying opportunity given that the stock is trading below its 50-day and 200-day SMA (Figure-3).
Figure-2 (Source: Finviz)
Figure-3 (Source: YCharts)
The... Read more

Stock name Last trade   P/E Earnings/Share Dividend/Share Dividend yield
ALLIANCE RESOURCE PARTNERS L.P. 15.86   4.5 3.49 2.16 12.95

ALLIANCE RESOURCE PARTNERS L.P. - ARLP
ALLIANCE RESOURCE PARTNERS L.P. - ARLP  


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