Coronado Global Resources: Rise and Fall of a Coal PlayerASX:CRN AMEX:COAL PSE:COAL BSE:COAL1!
Coronado Global Resources (ASX:CRN) is an Australian company specializing in metallurgical coal for the steel industry. With assets in Australia and the USA, it holds a notable position in the market. But is it worth investing in now? Let’s find out.
Financial Performance for the First Half of 2024
• Revenue: $1.3 billion
• Net Profit: $16 million
• EBITDA: $135 million
• Net Debt: Only $5 million
Low debt levels and stable cash flow ($63 million for the half-year) are strengths of the company in a challenging industry.
Stocks: From Triumph to Fall
Since its IPO in 2018, when Coronado raised $500 million, the stock price has dropped from $1.50–2.50 to 26 cents. Main reasons:
• Decline in coal prices in 2024
• Collapse of the deal with Seven (Sweden)
• Global disruptions such as COVID-19
Some believe the drop is excessive and expect a recovery to $1.50–2.50.
Challenges on the Horizon
• Coal Prices: Fitch forecasts $120/ton in 2025
• Technical Issues: Failures at Curragh increase costs
• Taxes: Rising levies in Queensland squeeze margins
Growth Prospects
Coronado is not giving up:
• New Mammoth mine (launch in December 2024)
• Expansion of Buchanan in the USA
• 300 million tons of reserves in the Bowen Basin - enough for more than 20 years
Plus diversified markets (China, USA, Japan).
Outlook for Coal Demand and Growth
Despite tightening environmental regulations and the global shift to renewable energy sources, which are pressuring thermal coal, the prospects for metallurgical coal remain more resilient. This type of coal, Coronado’s specialty, is indispensable in steel production, and demand for it is likely to persist over the next 5–10 years, especially in Asia (e.g., China and Japan), where metallurgy remains a key industry. Infrastructure growth in developing economies supports this trend, and the lack of large-scale alternatives to coking coal strengthens its position. With high-quality reserves and plans to open new mines like Mammoth, Coronado is well-positioned to meet this demand. However, coal price volatility and potential technological breakthroughs in steelmaking could pose risks, requiring careful monitoring.
Is It Worth Investing?
Pros:
• Low debt and strong balance sheet
• Steady demand for metallurgical coal in the steel industry
• Price at 26 cents promises 5–10x growth potential
Cons:
• Technical analysis shows a downtrend
• Coal price volatility
Conclusion
Coronado is a risky but potentially profitable bet. Financial stability and new projects inspire optimism, but the coal market is fickle. For experienced investors, this could be an entry point.
CRN trade ideas
CRN - Trade PlanCRN has headed into Resistance now and I expect a pullback. My Buy Zone is around $1.00 level where I would be be interested in taking a long position. At this level it looks overbought, and I think a pull back lower should be a very good buying opportunity.
Please note these are my own notes, by no means trading advice. Please do your own research before entering into any trade.
ASX:CRN - CORONADO GLOBAL RESOURCES INC.Ascending triangle formation is clearly visible. IMO - there is a bit of swing possible still but a good entry point if it breaks 1.01 today.
Fib levels also looking good, breaking the triangle formation, it could go onwards to R1 and R2 levels.
TP not yet definte but who ever is following CRN and this stock's journey would know about the recent Results ann and they have been doing well in the past 6 months.
Feedback appreciated.
Thanks
Akki
CRN - Pullback Over?CRN seems to be in a very stable uptrend as we have witnessed Higher Highs and Higher Lows. The recent pullback has provided an excellent buying opportunity as price has bounced of the Bullish Trendline for the third time, as well as the 200 SMA and the POC of Volume Profile. RSI has also popped out of the Oversold region and MACD Histogram is showing Bullish Momentum and is about to cross. I am bullish and my trade plan is to target the highs.
TP - $1.230 (Potential 11%)
Stoploss - $0.920
Please note these are my own notes, by no means trading advice. Please do your own research before entering into any trade.