Benzinga's Initiation Summary for May 31, 2012

Listed below are today's Top Initiations at Benzinga:

Global Hunter Securities said, "We are initiating coverage on ACI with a Neutral rating. We project that ACI will lose money the next 3-6 quarters. Based on its average EV/EBITDA multiple over the last three years of 8.9x multiplied by our 2013 EBITDA estimate it would represent $13.79 per share, but using our more traditional 6.5x multiple would derive $5.08 per share. We are not assigning a price target at this time."

Global Hunter Securities said, "We are initiating coverage of Alpha Natural Resources with a Neutral rating and no price target. Its EV/EBITDA multiple has averaged 7.1x over the last three years, which would generate a $21 share price when applied to our 2013 estimated EBITDA. However, in view of the fact that we project it will have a net loss over the next 1-2 years, we are not assigning a price target at this time."

Global Hunter Securities said, "We are initiating coverage of Cloud Peak Energy with a Neutral rating and a $15 price target based on the average of its 2010 and 2011 EBITDA and P/E multiples times our 2013 estimates. Its EV/EBITDA multiple averaged a modest 3.31x, while its average P/E multiple ran 11.1x, which we believe is a little rich for a coal company."

Global Hunter Securities said, "The company has committed all of its 2012 metallurgical coal production and will price it based on a quarterly benchmark. We project its 2013 EBITDA will rise to $1,083.9 million from $789.7 million in 2012. We are initiating coverage of WLT with a Buy rating and $79 price target, which is based on an EV/EBITDA multiple of 6.5x our estimated 2013 EBITDA."

Brean Murray Carret & Co. commented, "We believe SeaChange is well positioned to capitalize on the shift to TV Everywhere, and that new management has sharpened the company's focus and will improve financial results. SeaChange has divested non-core assets and is now focused on three primary businesses: (1) VOD operating systems; (2) Home Gateways; and (3) VOD ad insertion. We believe each of these businesses is well positioned to capitalize on current spending trends, and initial traction gives us comfort that the company is successfully transitioning the technology cycle."

Morgan Stanley said, "We are optimistic about revenue opportunities in both slow growth PCs and the higher growth smartphone/tablet business, but NVIDIA is in a very heavy investment phase that should hold back earnings leverage. New customers in growth markets will be key."

Morgan Stanley commented, "After excellent fundamental execution over the past two years, Intel likely has minimal earnings growth potential through 2014 as prices flatten, unit growth slows, and costs rise. Recent bullish margin guidance through 2013 and significant stock price outperformance leave little room for error."

Morgan Stanley said, "We expect significant improvement in the NAND market by 4Q12 and throughout 2013. As NAND capital spending declines anniversary, 2H12 supply growth should be at the lowest levels since 2009 (a very good period for NAND pricing), just as major customers accelerate orders. Supply will be low again in '13 as all four NAND players are being prudent."

Pritchard Capital Markets notes, "SM had a solid year in 2011 and we anticipate the company will continue to post strong production growth in 2012, primarily driven by its Eagle Ford, Williston Basin, and Granite Wash assets. Additional upside exists from SM's Permian and DJ and Powder River Basin positions. The company has a balanced portfolio of assets that allows it to exploit liquids in the near term, with long term natural gas optionality as the majority of its dry gas assets are HBP. Based on our current assumptions, we calculated SM has an NAV of approximately $90, with the company's operated Eagle Ford position accounting for roughly 39% of the NAV."

Imperial Capital comments, "We believe current prices provide an attractive entry point as we see meaningful future earnings growth following years of significant investments in research and development for new programs. …Even in an uncertain budgetary environment, we believe ORB's mix of priority government programs and commercial contracts provide meaningful revenue visibility."