Arch Coal's Analyst Day Takeaways

Arch Coal, Inc.ACI hosted an Analyst Day, providing financial, operating and strategic overview along with the latest company perspective, to which Citigroup writes: "Management believes they are well positioned going forward with additional PRB capacity following the Jacobs Ranch acquisition, low cost CApp mines, and low-priced legacy W.Bit contracts that reset in 2011. Specific to W.Bit, market prices are $40-$45/ton vs our estimated 2010 average selling price of $30/ton, which points to meaningful earnings contribution on volumes of 17.6 mln tons in 2011. That said, the company noted that W.Bit demand has been soft due to high inventories and a mild summer in the West." Citigroup reiterates its Buy rating and $30 price target for Arch Coal, Inc., which closed yesterday at $24.89.