- King Coal may be slipping but not enough to stop coal giants like New Hope.
- Recent economic events support the view coal must remain among the world’s energy sources.
- The price of coal fell sharply in 2023, driving down the New Hope Share Price.
Renewed interest in coal remaining in the global energy mix, coupled with the Ukraine war sent the price of coal soaring. Weather and supply disruptions in late 2023 cratered the price. Despite the current decline the share price of NHC is up 32.6% over five years.
Source: ASX
New Hope has two operating mines in Australia. In FY 2023 the company produced about eight million metric tonnes, with a forecasted increase to thirteen million metric tonnes by FY 2027. Financial Performance matched the rising price of thermal coal, with New Hope reporting strong upward growth in the last two fiscal years.
New Hope’s dividend payments track the price of coal and the company’s performance, with dividends of $0.86 and $0.70 per share in FY 2022 and FY 2023 far exceeding the five-year average of $0.23 per share. The FY 2023 dividend of $0.70 was fully franked. The five-year average dividend yield is 7.59%. New Hope’s current Price to Earnings Ratio (P/E) is 4.49.
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New Hope Corporation Financial Performance
Source: ASX
An analyst at Seneca Financial Solutions has a BUY recommendation on New Hope shares, calling the stock “particularly attractive for investors looking for yield and value given continuing demand for quality thermal coal.”
Marketscreener.com has a consensus UNDERPERFORM rating on New Hope, with four of the six analysts rating at HOLD, one at UNDERPERFORM, and one at SELL.
The Wall Street Journal has an analyst consensus UNDERWEIGHT rating on NHC, with three analysts at HOLD, and two at sell.
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