It's been a very busy day for transactions...
I normally don't add to a stock before earnings because there is a 50/50 chance of reaction either way. And it might not really matter what
Massey Energy's (MEE) earnings are tomorrow because all that matters anymore in the commodity space is the price of oil. Of which I've been a near term bear. (
Jun 26: Can a Near Term Top in Oil be Far Away?) I just did not expect every commodity within 6 degrees of Kevin Bacon to also be systematically destroyed with oil. Lesson learned. That said (ok maybe lesson not learned) I still believe in the coal and fertilizer stories. So I'm going to increase my exposure to Massey ahead of earnings tomorrow pushing the stake up from 0.6% to
2.5%. Purchases in the $73 range.
The stock is down 8% which can be attributed to (a) oil is down hence every commodity must be destroyed and/or (b)
Consol Energy (CNX) laid an egg. One thing about Consol is they are notorious for production problems, lawsuits, or some problem here or there. Luckily we exited (
May 30: Closing Consol Energy) but really it does matter - stocks that have given great earnings and guidance are being hammered just the same... Kevin Bacon after all. These are again 2009 stories but the market obsession with quarterly earnings has befallen CNX.
- Shares of Consol Energy Inc. fell sharply Thursday after the coal mine operator said its second-quarter profit dipped 34 percent as productivity problems pushed up costs.
- Consol said revenue and other income totaled $1.21 billion in the second quarter, compared with $1.06 billion in the same period last year.
- The results fell well short of Wall Street's expectations. Analysts polled by Thomson Financial were expecting Consol to earn 80 cents per share.
- Shares of Consol fell $12.64, or 14 percent, to $75.86 in midday trading.
- Chief Executive Brett Harvey pinpointed productivity problems that left highly productive longwall mining sections idled for lengthy periods as miners prepared new mining areas for problems in the quarter.
