ANR's Model Updated By Citigroup

Citigroup has published a research report on Alpha Natural Resources

and is updating its forecast model on the company. In the report, Citigroup writes "Investors should focus on incremental contract layering and on cost inflation in the East. Prior guidance for 2010 called for 23-26 mln tons of Eastern thermal, 11-13 mln tons met and 47-50 mln tons of Western coal. At the end of last quarter, ANR had only 700k tons of planned met and 1 mln tons of Eastern thermal open for pricing this year and for '11 was 94% contracted in the West, 62% contracted for Eastern thermal and 19% priced for met. Looking forward, we will look for more color on the developments at Deep Mine #41 and Cresson as well as longer term Freeport Greenfield and their impact on volumes and capex. We estimate 3Q10 operating EPS of $0.78 ($0.80 consensus) with ANR earning $244 mln EBITDA on $991 mln revenue." Citigroup maintains its Buy rating and $59 price target. Alpha Natural Resources closed Friday at $46.67.