FBR Capital Gives a Hold Rating to Warrior Met Coal Llc

By Ryan Adsit

FBR Capital analyst Lucas Pipes assigned a Hold rating to Warrior Met Coal Llc (NYSE: HCC) today and set a price target of $26. The company’s shares opened today at $23.57.

Pipes said:

“This morning, 10/17, MSHA released Warrior’s most critical MSHA number for 3Q17, reporting production for Mine No. 7. HCC beat our production estimates, having produced 1.14 million short tons at Mine No. 7 and 0.48 million short tons at Mine No. 4 (as previously reported). Production decreased at both mines compared to the prior quarter. Mine No. 7 output declined 250,000 short tons QoQ and Mine No. 4 output declined 36,000 short tons QoQ. Although production was slightly higher than we expected (by about 100,000 short tons), our estimates had been the low on the Street and the reported MSHA production makes a major Q3 beat less likely, in our opinion. Possible positive surprises could still occur from the sale of lower-cost inventories, stronger sales on destocking, and sales price realizations. We assume that the company destocks about 140,000 short tons but that costs per ton still rise as new hires raise the overall cost basis. Lastly, we tweaked our sales price realizations higher to $163/Mt, which would be 96% of the Q3 lagged benchmark index.”

According to TipRanks.com, Pipes is a 3-star analyst with an average return of 3.3% and a 48.6% success rate. Pipes covers the Basic Materials sector, focusing on stocks such as Peabody Energy Corporation Comm, Newmont Mining Corporation, and Stillwater Mining Company.

Warrior Met Coal Llc has an analyst consensus of Hold, with a price target consensus of $25.67.

The company has a one-year high of $27.62 and a one-year low of $15.10. Currently, Warrior Met Coal Llc has an average volume of 464.5K.

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Warrior Met Coal, Inc engages in the production and export of metallurgical coal. The firm It extracts methane gas from the Blue Creek coal seam. It operates through the Mining and All Other segments. The company was founded on September 3, 2015 and is headquartered in Brookwood, AL.