RE: RE: 14 Bucks NavTHe report is dated April 18, 2011. It should be on the Jennings website. Their target for CMK is$6.50 but they comment that using the current price of coal CMK has a NAV of $14 per share using a discounted cashflow model. Their $6.50 target is an average of 4 valuation metrics including the NAV.
All the long term models bring met coal back down to the high ones. It met coal stays at current values while cline mines 3M tonnes a yr watch out - lots of cashflow and EPS. I think its unlikely for met coal to stay at high 2 or low 3 for the next several yrs.
Here is an extract:
Valuation Upside Potential – We note that, usingcurrent benchmark price levels of US$298/tonne (based
on Energy Publishing’s index for high-vol coal), our
NAV8% estimate would be over $14/share. For eachUS$10/tonne change in our benchmark pricing
assumption, our NAV estimate changes by
approximately
.64/share. We continue to use a longterm
benchmark price of US$170/tonne beginning 2014,
which we then discount by approximately 10% for quality
(ash content).