UPDATE: UBS Upgrades Arch Coal Inc (ACI) to Buy; Risks In Rear-View; Valuation Upside

May 14, 2012 7:42 AM EDT
Get Alerts ACI Hot Sheet
Price: $0.58 --0%

Rating Summary:
    9 Buy, 13 Hold, 12 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 30 | Down: 30 | New: 23
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(Updated - May 14, 2012 12:56 PM EDT)

UBS upgraded Arch Coal Inc (NYSE: ACI) from Neutral to Buy. PT lowered $1 to $11.

Analyst, Shneur Z. Gershuni, said, "The upgrade in part is due to valuation as ACI has sold-off over the past several months. Our downgrade of ACI in mid-Jan was premised on weak thermal market conditions and potential for fuel switching. Since that time a healthy portion of these risks have played out and are now somewhat behind us. Ultimately, ACI is levered to natgas pricing – if prices rise then ACI should benefit as coal stocks tend to trade on pricing expectations."

Gershuni still prefers names in the met coal sector, including Walter Energy (NYSE: WLT) and Alpha Natural Resources (NYSE: ANR), but valuation on ACI is currently compelling.

For an analyst ratings summary and ratings history on Arch Coal Inc click here. For more ratings news on Arch Coal Inc click here.

Shares of Arch Coal Inc closed at $8.06 yesterday.

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