Irl Engelhardt stocks up on Patriot Coal

That the Dow Jones Industrial Index fell another 251 points on Monday to close at the lowest level since Oct. 1997. The drop in stock markets over the past eight months underscores just how many more people have been selling stocks than buying them lately. But there are exceptions to every rule.

Take Irl Engelhardt, the non-executive chairman of Patriot Coal Corp., for example. Engelhardt, who helped transform Peabody Coal Corp. into the world’s largest publicly traded coal producer, bought 100,000 shares of Patriot on Friday through a family trust at prices between $3.51 and $3.63 a share, according to a Securities and Exchange Commission filing. 

While that didn’t the help stock on Monday (Patriot shares fell further, to $3.09), it’s worth wondering if Engelhardt opened his wallet because he believes that Patriot, one of the largest coal producers in the eastern U.S., is undervalued. Or as a vote of confidence in the beleaguered stock. Or both.

At the very least, Engelhardt should be very familiar with Patriot’s assets and given his experience he should have a pretty good handle on industry fundamentals.

Whatever his reasons, it’s been a wild ride for Creve Coeur-based Patriot since it was spun off from Peabody in Oct. 2007. After peaking at a split-adjusted high of $80.69 a share in June, the stock has come crashing down at a rate than makes the decline in the Dow seem mild by comparison.

It’ll be interesting to see in a year, or three or five, how or if Engelhardt’s investment pays off.