Citi Raises Price Target On Alliance Resource Partners After Earnings (ARLP)

Citi Investment Research raised its price target on Alliance Resource Partners, L.P.

after the company reported earnings. It went from $58 to $56, but kept its Hold rating on shares. In a note to clients, Citi writes, "We are maintaining our Hold/High Risk rating (2H) while slightly increasing the target price to $58.00. We believe that the units are near fully valued at current levels. Our target price for ARLP is based on a 7.0x EV/EBITDA multiple to our 2011 estimates. We continue to believe that ARLP should trade at a premium to C-corp coal names due to its attractive yield, tax advantages of the MLP structure and substantial commitment for future production. At current valuations we prefer integrated natural gas MLPs such as WPZ and EPD." Shares of ARLP lost $1.54 yesterday to finish at $59.45, a loss of 2.5%.