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From PBRG Founder Tom Dyson in Tom’s Confidential: The Obama administration—and much of the world—has declared a “war on coal.”
Most coal stocks are down over 90% over the last five years. More than three dozen coal companies have declared bankruptcy in the last four years alone.
Here’s a chart showing the steady decline in the coal sector.
The Market Vectors Coal ETF—the main coal sector proxy—has lost over 76% over the last four years.
But the world continues to overlook the vital importance of coal as an inexpensive, reliable source of energy.
About 40% of the world’s electricity comes from coal. So does 30% of the world’s primary energy.
The Energy Information Administration (EIA) projects coal will make up 34% of U.S. electricity sources by 2040. More than 1,200 new coal facilities are planned to be built across 59 countries over the next few years.
Meanwhile, China and India continue to consume vast quantities of coal in their ongoing industrialization. Compared to other basic sources of energy, such as natural gas and oil, coal is still the cheapest option.
Bottom line: Coal isn’t going anywhere for at least the next 25 years. Consider a “smart speculation” in coal. In the August issue of Tom’s Confidential (TC), we recommended a coal stock we believe will become the TC portfolio’s first “ten bagger.” Infinity subscribers can click here to review the recommendation.