Coal Pricing Keeps NRP a Buy

5/14 - "We are maintaining our Buy recommendation on Natural Resource Partners (NRP)...The company should see higher revenues, margins and distributable cash flow mainly driven by the favorable pricing of Appalachian Basin coal, which the company is heavily levered to."

"We are increasing our target price to $39.00 from $36.00 per unit and have increased our 2008 earnings estimates to $1.67 from $1.63 per unit. Our 2009 earnings per unit estimates remain unchanged. When an MLP can consistently generate solid distributable cash flow -- which NRP defines as cash flows from operating activities less scheduled principal payments and reserves set aside for future principal payments -- it can increase its quarterly distributions, which NRP has done for 19 consecutive quarters."