Corporate Action: Vote in Favour of Whitehaven’s Proposed Buyback, FVE Raised to AUD 12

We raise our fair value estimates for thermal coal miners due to continued strong thermal coal prices. Of our coverage list, no-moat Whitehaven Coal is the most impacted, and we increase our fair value estimate to AUD 12 per share, up from AUD 9. We also recommend shareholders vote in favour of the company’s proposal to buy back up to 240 million more shares over the next 12 months. With Whitehaven shares trading at a 31% discount to our increased fair value estimate, we think the proposed buyback is likely to be accretive. We also raise our fair value estimate for no-moat New Hope Corporation to AUD 8 per share, up from AUD 6.30, and reduce our fair value Uncertainty Rating to High from Very High. No-moat Glencore is the other company we cover with material exposure to thermal coal, and we raise our fair value estimate to GBX 700 per share, up from GBX 570. About GBX 35 of the increase is due to a weaker GBP/USD rate.