Arch Coal (ARCH) PT Lowered to $106 at MKM Partners

MKM Partners lowered its price target on Arch Coal (NYSE: ARCH) to $106.00 (from $107.00) while maintaining a Buy rating, saying 1Q results were a surprise but the reaction was overblown.

Analyst Daniel Scott commented, "Last month, Arch Coal reported 1Q EBITDA of $105 million, below our estimate and consensus. The company had geological issues at Mountain Laurel coking coal mine, and lowered full year guidance for coking coal due to lower volumes and higher average unit costs. They also cut production at their flagship PRB mine at Black Thunder this year to 62-68 million tons from 70-80 million tons previously. The stock was down that day 13.2%, versus the S&P500 being up 0.6%. We believe the items that weighed on results are shorter term in nature, and that the pullback was overdone."

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