COECF-CanAm Coal: On Target to Produce 1 Million Tons in 2013
Calgary based CanAm Coal Corp (TSX-V: COE) is an active coal producer with four operating mines in Alabama. Since late-2009, the management team has been executing a three to five year strategy to increase annual production to between 1-3 million tons through the acquisition, exploration and development of coal resources. As a result, the company has experienced extraordinary growth in recent years. In 2011, CanAm's coal sales multiplied five times, from 48,361 tons in 2010, to 256,221 tons, while, in 2012, it projects to sell between 450,000-550,000 tons, twice the sales of 2011.
Impressively, the company has sold up to 85% of its estimated production for 2012 in long term contracts, which generally last a minimum of three years. However, despite these positive developments, the stock price has remained stagnant, due, in large part, to a lack of exposure and a tough environment for natural resource stocks, particularly small caps. Nevertheless, through thick and thin, CanAm's business continues to thrive, which suggests shares in this undervalued company have strong upward potential when market conditions improve.
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