Topic: How To Invest

Pat: Will you please review CanAm Coal as a possible buy? Thank you.

Article Excerpt

CanAm Coal Corp., $0.14, symbol COE on Toronto (Shares outstanding: 104.9 million; Market cap: $14.7 million; www.canamcoal.com), owns four coal mines in Alabama. It is also developing a coal-to-liquids technology that converts coal into liquid fuels (such as oil and jet fuel). CanAmalso owns the Buick coal project in Colorado. In the three months ended April 30, 2011, CanAm’s revenue rose 187.5%, to $3.2 million from $1.1 million. Higher coal production and prices were the main reasons for the gain. CanAm earned $227,604, or $0.002 a share, compared to a loss of $25,053, or nil per share, a year earlier. Cash flow was $795,523, or $0.008 a share, in the latest quarter. The company’s long-term debt of $1.6 million is 11% of its market cap. CanAm holds cash of $2.4 million, or $0.02 a share. CanAm plans to acquire more coal mines and continue developing its coal-to-liquids technology. The company has licensed this technology from a company that has an operating plant in…