Ugly Day for Walter Energy, Coal Stocks

Aaron Task breaks down the falling stock and the future of coal.
3:00 | 03/20/14

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Transcript for Ugly Day for Walter Energy, Coal Stocks
I'm Dan that -- -- New York as the financial market closed for this Thursday march 20. It's a story stock and one stock with a store today is that Walter energy producer and exporter of coal. The company owns fifteen mice in three countries back in 2012 producing eleven point seven million metric tons of coal with. 2.4. Billion dollars in sales but some are saying Cole. Is a dinosaur and stock in Walter energy has been dropping. Sort of break it all on -- bring -- -- -- finance Aaron what is happening in the world of Walter energy and coal stocks in general. I was really bad day for Walter energy mean it's -- -- back couple years really for coal as an industry. Walter energy got got slammed by Bank of America which forecasts quote depressed prices for call for the next several years. And they slashed their price target on Walter energy from eight dollars a share to two dollars a share. And the stock for more than 20% its low point today it was just an ugly day for Walter. Some of the other coal stocks got hit as well -- Arch Coal output natural resources but nothing on the scope. Terms of percentage declines as a result Walter energy -- most of the cold -- is -- domestic or international consumption. Well listen it's going internationally because the Obama administration has -- really put the clamps. On coal in this country and it's been a major issue. In clean coal country like West Virginia particularly. The president is even less popular there than he's in the rest of the country. -- around the world especially in China and India and some fast growing emerging economies they are turning to -- as a major source of power. And so what you're now seeing. Is US coal company -- export their coal in large numbers for the first time minutes it could. Revive -- industry but for now this is an entire group that's really. I've been taking to the which well I -- take a look at how Walter energy stock has been doing let's pull this up there over the past three months. Taking a look walk us through this as far as you know -- saying the devaluation put -- buyback America include the stock. Living up to that that new status. -- they did and also yesterday welter and -- announced debt offering about to a million dollars and so it. You know it. You you can paint a scenario where this company is going deeper into debt and its primary business is shrinking. Where -- these is going to be difficult for the foreseeable future Bank of America is correct and so. Are they gonna have trouble repaying that debt -- -- you -- paint a scenario where things get really ugly for a company like Walter energy unite I think. That has the reaction the market today. You know again if the coal industry can figure out and export business maybe there's a potential for revival but right now that the prospects -- program. Well I'd ask you about that because imports are there winners and losers obvious in everything. -- looking as if it's going to be somewhat of a struggle their solar though always looking as if it's Monday. Be on the horizon if not already -- long term though what can Walter energy unit essentially re energize itself if any thing. Read that there's not a whole what they -- you about the the global price for coal and -- -- used to make steel prices there at their lowest level since 2010. And frankly if the global economy continues to slow that's -- mean less demand for steel less demand for coal. So not a whole lot that they can be there -- I can't imagine if you buy administration's gonna suddenly change their perspective -- And have real decent regulations for coal in this country so not a lot of hope on that front too so. Again not not a lot of agree things I can think for the folks -- are energy are thinking very hard about it but not a lot of things that immediately come to mind as to what they can do to right the ship here he had a true a lot of investors are hoping that that -- -- those answers as well -- -- a look at the Dow finished the day for this Thursday. Doubt -- about a 108 points 161000. 331. Aaron task from Yahoo! finance -- -- that you appreciate that of course you can watch store stocks with abcnews.com for latest headlines. -- -- --

This transcript has been automatically generated and may not be 100% accurate.

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