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US coal company shares rise on upgrade

Steel News - Published on Thu, 31 May 2012

Reuters reported that Shares in US coal companies climbed on Tuesday after Goldman Sachs raised its coverage view for the sector to \"attractive\" after a recent pullback in coal stock prices.

Analyst Andre Benjamin listed Peabody Energy with a \"buy\" rating because of improving macro-economic news from China, where the company exports coal from its mines in Australia. He also cited better Australian prices for thermal coal, which is used in power generation.

Mr Benjamin also gave a \"buy\" rating to Consol Energy, which produces not only coal, but natural gas.

Mr Benjamin in a research note said that \"We raise our coverage view to \'Attractive\' from \'Neutral\' in a tactical move as the recent pullback in prices leaves us with attractive average upside for the coverage group as a whole.”

Despite the positive view of the sector in general, the Goldman analyst cut the stock price target for Alpha Natural Resources to USD 12 from USD 16, citing \"thin thermal coal margins\" in the Central Appalachian region of Virginia, West Virginia and eastern Kentucky.

Source - Thomson Reuters


Posted By : admin on Thu, 31 May 2012
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