One of the sectors I want to buy when it's on sale is the coal business, whether from the standpoint of energy or steel.

Today I'm recommending Fording Canadian Coal Trust (FDG) and the booming global steel industry where FDG's business is concentrated.

Fording Canadian Coal Trust is an open-ended mutual fund trust and one of the largest royalty trusts in Canada. The trust makes quarterly distributions to unitholders using royalties received from its 60% interest in the metallurgical coal operations of the Elk Valley Coal Partnership.

Despite interruptions in coal production and delivery that may cause wild price swings, the underpinnings to the supply and demand equation for metallurgical coal are solidly bullish. Growth in infrastructure within China and other emerging economies is driving demand for steel on a worldwide basis and shortages in met coal are real.

Given the upward guidance provided by several major steel producers, I believe that demand for FDG's coal will continue to be strong and that we will see further dividend payments rivaling the most recent quarter.

Shares of Fording Coal hit an all-time high of $96 just last Wednesday, June 30, before the steel sector corrected. Now 20 points lower at $76, the shares look attractive to me based on forward numbers.

The trust is expected to see revenues rise more than 100% for 2008, and earnings are expected to advance better than 60% in 2009, approaching $14 per share. Assuming those estimates hold up, the stock is a buy under $80.

Buy Fording Canadian Coal Trust (FDG) under $80, and I'll have more information about Fording Trust in the July issue of The 25% Cash Machine Newsletter.

I'll see you Friday with the Weekly Update.

Bryan Perry

Editor The 25% Cash Machine