Goldman Sachs Makes Changes In the Coal Sector (KOL, BTU)

November 20, 2009 8:38 AM EST

Goldman Sachs is making some changes in the Coal sector today. The firm removed Peabody Energy (NYSE: BTU) from the Conviction Buy List and raised price targets on a number of coal companies. The firm said the Asia S-D tightness favors US met for last leg of multiple expansion.

Alpha Natural Resources (NYSE: ANR) remains the firm's top pick, and they continue to rate Peabody (NYSE: BTU) and Massey Energy (NYSE: MEE) Buy.

Price target changes:

• Alpha Natural Resources (NYSE: ANR) (Buy) to $56 from $50
  
• Arch Coal Inc. (NYSE: ACI) (Neutral) to $27 from $24
  
• CONSOL Energy (NYSE: CNX) (Neutral) to $58 from $54
  
• Massey Energy (NYSE: MEE) (Buy) to $48 from $38
  
• Patriot Coal (NYSE: PCX) (Sell) to $14 from $12
  
• Peabody Energy (NYSE: BTU) to $56 from $50.

Investors should keep an eye on sector ETF Market Vectors Coal ETF (NYSE: KOL) today on the call. In addition, there is a IPO in the sector - Cloud Peak Energy (NYSE: CLD). CLD is a spin-off from Rio Tinto (NYSE: RTP) and is the third largest producer of coal in the U.S. Shares priced at $15, below the expected $16-$18 range.

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