ICG Stock Dips as Company Posts 3rdQ Losses (10/27/06)

The chart of ICG’s stock performation is by Reuters stock quote.

Wilbur Ross’s International Coal Group (ICG) ,  owns the West Virginia Sago mine, where a January explosion killed 12 miners, gravely injured the sole survivor and contributed to the suicide of two miners later in the year.  The company reported its third quarterly loss October 25 of $2.4 million, or 2 cents per share, compared with net income of $8.6 million, or 8 cents per share, for the same period last year.

You’d think the stock price would go down, but the next day the price went up 10% as demand surged.   And it’s up another 1.55% as of 3:08 p.m. today. 

According to Reuters story yesterday, “Sago mine owner’s stock surges despite quarterly loss,” , production cuts attracted buyers.  Ian Synnott, of Natexis Bleichroeder explained,

Wall Street is definitely giving a reward to companies that exercise discipline and cut production.  

3.2 million tons of high-cost Appalachian region production capacity is being idled. Reduced production tightens the market for coal and raises prices for coal  supplied to utilities to fuel power plants.  Another sad indication that what’s good for workers and consumers  is not necessarily what’s attractive to investors. Still, even at $5.23 a share, the price is down compared to a high within the year of $14.40. 

 

 

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