- Metallurgical coal prices have increased by over 25% since November.
- This should allow Arch to generate modestly positive cash flow in 2021 while completing Leer South.
- After 2021, current prices may allow it to generate over $200 million in positive cash flow.
- Thermal coal assets remain of limited value.
- Arch's valuation appears reasonable based on my modeling of long-term met coal prices, although it could have upside with current prices being higher than that baseline now.
For further details see:
Arch Resources: Strength In Metallurgical Coal Prices Should Improve 2021 Results