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Walter Industries a One-Stop Shop for Coal, Natural Gas and Housing

 May 02, 2008 10:37 AM UTC
Symbol Sentiment Start Return Closed
WLT Positive 05/02/08 +33.52% 07/29/08
ANR Positive 05/02/08 +12.37% 05/06/08
MEE Positive 05/02/08 +22.62% 05/22/08

Graphic_arrow1 Via Long Investment Ideas from Seeking Alpha:  

I've been watching this Walter Industries (WLT)
for 2 months now as it kept showing up on my weekly top performing
lists throughout February;<!--more-->just kicking behind week after week...


....we got you some metallurgical coal (yes!)....we got you some coking coal (yes!)....we got you some natural gas (yes!)....we got you some homebuilder...... I said... we got you some homebuilder...Ruh roh Raggy!No
wait! Homebuilders are the new darlings of '08... so I got you some
metallurgical coal (steel play), with some coking coal (steel play),
with some natural gas, WITH a homebuilder, and as a cherry on top a
financing division! Bonus!What does that give you? Put it in a pot, mix it all about ... 100% gains since the January 2008 low. Nice!

So if the 2nd half "no
inflation but enough inflation so that commodities boom, but not enough
that it hurts US consumers, so they can buy houses, so therefore you
must buy homebuilders, and then credit markets clear up perfectly so we
can finance those houses" scenario works out (and don't you dare
believe it won't) this looks like with this 1 stock you can play all those
trends, under 1 roof. Wowsers! They reported yesterday  and while the
housing/financing side was a disaster (never mind that, it will be the
strength of the company in 6 months), I was interested in the coal side of the business which is.... booming.

 Graphic_website1 Read the rest of original post »



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Scott R   58%     3 points   commented 553 days ago reply

I bought WLT in Dec '06 but not for their home division or even their coal division then, but because they were spinning off what I thought would be their most profitable division - Mueller Water. (MWA)

When they split, MWA didn't move, but I noticed WLT started ticking up ever so slowly.

Then within a year WLT was up about 80%, so I decided to keep it and ride the wave. :) I ditched Mueller, which was the reason I got into WLT in the first place. Ironic, huh?

Sometime last fall WLT announced they were splitting off their homebuilding division (Jim Walter Homes) to focus on their coal/nat gas division. This was the start of some large, quick gains for WLT as investors saw that the company was serious about focusing on the most profitable part of their business, primarily coal.

We shareholders have been rewarded ever since. Today analysts dropped another bombshell and stated that coal prices will continue to rise through the next 2 years. We enjoyed almost a 12% spike from that bit of news today.

When will the party end? I don't know, but I've ridden the wave for a year and a half now and I've got my stop loss ratcheted down just in case it's maxed out.

Scott

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