In this piece, we discuss the 10 Best Coal Stocks to Invest In According to Hedge Funds.
Coal has found itself at the center of U.S. energy policy in a way it has not been in decades.
On June 4, 2026, Reuters reported that President Donald Trump invoked the Defense Production Act, a 1950 law granting presidents broad authority over industries deemed critical to national security. With that invocation, Trump will direct $425 million in upgrades to 13 coal-fired power plants and $75 million toward the proposed West Gateway coal export terminal in Oakland, California.
The Energy Department also said it was finalizing up to $350 million in previously announced funding for four additional coal facility projects, including new power plants in Alaska and West Virginia. The administration framed the move in national security terms, citing the need to ensure electricity for AI data centers and reduce reliance on foreign energy sources.
The announcement followed reports on June 3, 2026, that Trump was planning to deploy nearly $700 million using Cold War-era defense powers, including more than half directed at 13 coal plant upgrades, $185 million to match corporate funds for facilities in Alaska, Maryland, and West Virginia, and $75 million for the West Gateway terminal.
The policy push comes against a challenging structural backdrop.
Coal’s share of U.S. electricity generation has fallen from nearly 60% in 2000 to about 16% in 2025, according to Reuters reporting from June 5, 2026, which cited unfavorable economics, construction complexity, logistical burdens, and limited export upside as forces unlikely to reverse regardless of policy support.
With that background in mind, let’s now jump to our list of the best coal stocks to invest in.
Our Methodology
To curate our list for this article, we scanned financial media and stock screeners to identify coal stocks. Next, we assessed hedge fund sentiment toward these stocks using Insider Monkey’s hedge fund database, which tracks the holdings of more than 1,000 hedge funds as of Q1 2026. Our final list is ranked in ascending order based on the number of bullish hedge fund positions.
Note: All data sourced on June 5, 2026.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
10. NACCO Industries, Inc. (NYSE:NC)
Number of Hedge Fund Holders: 7
With $14 million invested in the stock by hedge funds as of Q1 2026, NACCO Industries, Inc. (NYSE:NC) is among the best coal stocks to invest in. The company’s current growth reflects a management team that appears to be strategically expanding beyond its coal mining roots.
Speaking on the May 6, 2026, earnings call, CEO J.C. Butler described a company executing on multiple growth fronts simultaneously.
NACCO Industries, Inc. (NYSE:NC)’s headline numbers were solid: first quarter operating profit rose 43% year-over-year to $11 million, net income climbed 80% to $8.8 million, or $1.17 per share, and adjusted EBITDA grew 28% to $16.4 million.
However, the more compelling story is where that growth is coming from and where management is pointing next.
Contract Mining has become NACCO Industries, Inc. (NYSE:NC)’s clearest growth platform, leading the company’s sequential growth during the quarter. NACCO commenced work on a multi-year dragline services contract for a U.S. Army Corps of Engineers construction project in Palm Beach County, Florida, during the first quarter, deploying two MTech electric drive draglines with a third to be added later in 2026. A second new contract, a limestone quarry operation in Arizona, is set to begin in the second half of the year.
Butler said he expects a substantial year-over-year increase in both operating profit and segment adjusted EBITDA in the Contract Mining segment.
Meanwhile, Mitigation Resources, a subsidiary of NACCO Industries, Inc. (NYSE:NC), is building toward longer-term profitability.
In mid-April, the company’s subsidiary acquired 958 acres in Wilson County, Tennessee, east of Nashville, with wetland and stream mitigation credits anticipated to be available in 2029. Butler framed the acquisition as an expansion into a region experiencing steady economic growth. NACCO Industries, Inc. (NYSE:NC) also has a contract mining position tied to the Thacker Pass lithium project, with first deliveries expected in late 2027. Butler said the project is progressing on schedule.
NACCO Industries, Inc. (NYSE:NC) had $53.2 million in cash and $49.5 million in revolver availability at March 31, 2026.
NACCO Industries, Inc. (NYSE:NC) is a holding company focused on natural resources, primarily operating surface coal mines under long-term contracts for power generation companies. Through its subsidiaries—notably The North American Coal Corporation—it manages coal mining, provides contract mining services for aggregates, lithium, and other minerals, and manages mineral interests.
9. American Resources Corporation (NASDAQ:AREC)
Number of Hedge Fund Holders: 19
Hedge funds held $27 million worth of positions in the stock as of Q1 2026, placing American Resources Corporation (NASDAQ:AREC) among the best coal stocks to invest in.
However, American Resources Corporation (NASDAQ:AREC) is building a case for investors as a critical minerals platform in transition, with management outlining an updated strategy during the week ending May 24, 2026.
Speaking with Proactive, CEO Mark Jensen described a company that has fundamentally repositioned itself over the past year.
American Resources Corporation (NASDAQ:AREC) moved from negative shareholder equity of roughly $80 million to positive equity of approximately $93 million, driven by the divestiture of legacy coal assets and the spinout of ReElement Technologies. The removal of a going concern qualification adds to that momentum, and Jensen said the company now holds more than $72.5 million in cash with no immediate need for additional fundraising.
ReElement, a wholly owned subsidiary, remains central to the company’s story.
American Resources Corporation (NASDAQ:AREC) retains around 17% of the spinout while maintaining a feedstock supply relationship with it. Jensen said the refining platform is already capable of producing key rare earth elements at competitive costs, describing it as a meaningful asset within the domestic critical minerals sector.
The company’s forward strategy moves away from building its own domestic mines.
Jensen argued that many U.S. mining projects struggle to compete economically against lower-cost international alternatives. Instead, American Resources Corporation (NASDAQ:AREC) is pursuing ownership stakes in mining operations across Southeast Asia and Africa, with a focus on elements including germanium, gallium, yttrium, and gadolinium, which Jensen said remain difficult to source outside China. He said discussions on multiple mining partnerships and supply agreements are already well advanced.
Jensen described the broader strategy as taking stakes in international mines that can supply ReElement, while spreading risk across multiple jurisdictions.
Indiana-based American Resources Corp (NASDAQ:AREC) is engaged in producing and supplying raw materials for the infrastructure market. Its material supplies include steel, alloys, and critical minerals. Through its Electrified Materials Corporation and ReElement Technologies Corporation units, the company recovers, processes, and refines rare-earth elements and other minerals. The company also offers coal byproducts.