We are maintaining our Buy recommendation on Arch
Coal and increasing our 2008 earnings estimate from
$2.37 per share to $2.64 per share. With international
and domestic coal prices at record levels, Arch s
market driven strategy should help maximize its reserve
base. Having significant unpriced volumes of 60% and
77% in 09 and 10, respectively and recently pricing
several million tons of 2008 unpriced production at
significant premiums to Q1 08 prices, we feel that ACI
will experience significant earnings growth in the near
term. Additionally, In Central Appalachia, nearly one
third of its 2008 estimated production is metallurgical in
nature. This type of coal fetches prices in the triple
digits and should boost earnings and cash flow. We see
very little downside to the company s story with large
near term upside potential.
by Zacks
http://astuk-virtuallystocks.blogspot.com/
$56.16 (04/25/08)
