Jefferies bullish on miners as metallurgical coal prices recover
17/09/2020 17:26
** Jefferies says metallurgical coal is "heating up" as
prices have begun to recover from trough levels
** Brokerage adds the outlook has improved as Chinese steel
production should remain elevated and the country's coal import
restrictions for 2020 should ease
** Environmental concerns regarding coal are unlikely to
subside, but cash flow is the offsetting positive for miners
that have exposure to met coal specifically - Jefferies
** Of the major miners, brokerage prefers Anglo American
AAL.L and BHP Group BHP.AX based on valuation and commodity
exposure
** Recovery in met coal prices from trough levels would be a
positive for U.S. miners like Arch Resources Inc ARCH.N and
Warrior Met Coal Inc HCC.N - Jefferies
** Brokerage raises PT on ARCH to $45.00 from $37.00; On HCC
to $18.00 from $15.50
** Jefferies increases PT on Peabody Energy Corp BTU.N to
$3.25 from $3.00, and on Ramaco Resources Inc METC.O to $3.70
from $3.00
(Reporting by Shruti Sonal in Bengaluru)
((Shruti.Sonal@thomsonreuters.com; Twitter: @shrutisonal26))