FBR Capital Reiterates an 'Outperform' on Alpha Natural Resources (ANR); Raises Estimates & PT

November 5, 2009 10:59 AM EST

FBR Capital reiterates an Outperform rating on Alpha Natural Resources (NYSE: ANR) and increase price target to $54.00 from $52.00.

FBR analyst says, " Potential catalysts: The potential catalysts are (a) production cuts announcement by other producers (4Q09-1Q10), (b) higher U.S. coal exports, (c) continued improvement in domestic steel capacity utilization, (d) additional met coal resource acquisition, and (e) update on synergies gained (1Q10) from the merger."

"We are adjusting our 2009 earnings estimate from $1.60/$686M on a pro forma basis to $1.77/$512M on a reported basis, primarily to reflect actual 3Q09 earnings. We are leaving our 4Q09 estimates unchanged. However, we are increasing our 2010 EPS/EBITDA estimate from $2.47/$812M to $3.02/$907M, primarily to reflect increased met volumes (from 9.0 MTs to 10.2 MTs), partially offset by a slight lowering of steam volumes (from 74 MTs to 72.95 MTs). Our met coal volume assumption remains at the bottom end of management guidance of 10 MTs to 12 MTs to reflect our slightly cautious outlook on 2010 steel production."

To see more analyst ratings on ANR Click Here.

Alpha Natural Resources, Inc. operates as a coal producer primarily in the central Appalachian and northern Appalachian regions.

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