Hallador Energy (NASDAQ: HNRG) Emerging Growth Stock Pick

Like most political negotiations the debt ceiling debate’s opening act is posturing. The Democratic position has been firmly set by President Obama insisting on a “clean” debt ceiling hike, refusing to negotiate spending cuts. On the Republican side, Senate Minority Leader McConnell said that “balance” post the tax hike from the fiscal cliff means the opposing side has to implement spending cuts. That said, the Republican stance is firm in that further taxes will not be part of the debt ceiling deal. McConnell also stated “Democrats need to specify the cuts.” Not too long ago Republicans made this same demand during the fiscal cliff talks on entitlements, and not much happened there. Senator Cornyn, a Republican from Texas wrote in the Houston Chronicle “It may be necessary to partially shut down the government in order to secure the long- term fiscal well being of our country.”

There seems to be a pretty big split here as Democrats are not negotiating at the moment, and Republicans are saying that you pick the spending cuts we want, or we’ll shut it down. The country has been going through too many of these debates, and despite the recent fiscal cliff being avoided, folks are not happy with the results. The real problem is that the divide continues to grow between the parties while more animosity towards each other seems to build up every day. There are of course good people in Congress, but there is a growing group in each party whose views are so entrenched, that they risk the well being of the country. US politics have become so much of a concern for investors that they need to diversify themselves, including companies that have products and services that are necessities.

Hallador Energy (NASDAQ: HNRG) founded in 1949 focuses its business on the production and sale of steam coal to the utility industry in the United States. Hallador’s operations are based in Denver, Colorado. The company owns interests in the Carlisle mine, an underground coal mine located in western Indiana, as well as a 45% equity interest in Savoy Energy, L.P., an oil and gas company with operations in Michigan.

The stock currently trades at $8.25 and has a 52-week range of $6.55 – $11.00. The company has a market cap of $232 million and in the last 40-days has seen a lot of insider stock purchases by its executive team. On December 16^th, the President of Hallador, Brent Bilsland, acquired 62,500 shares. On the same day CFO Bishop purchased 50,000 shares and CEO Victor Stabio bought 82,500 shares. Late November of 2012, Chief Officer Lawrence Martin purchased 12,500 shares.

Sunrise Coal, a subsidiary of Hallador, recently completed a new five-year senior secured $165 million credit facility. The company was able to complete this facility at favorable terms despite the current slump in the coal business. The facility was created to help fund the development of new projects in Illinois and Indiana. Hallador was recently upgraded by Brean Murray and rated a new “buy,” with a twelve-month price target of $10 dollars a share. Considering the support at $8.00 a share on the chart and the recent spate of insider buying, Hallador looks like a good buy for Q1 of 2013.