Wednesday, September 15, 2010

FBR (Nasdaq:FBCM) Maintains "Outperform" on Cliffs (NYSE:CLF)

FBR Capital (Nasdaq:FBCM) reiterated its "Outperform" on Cliffs Natural Resources (NYSE:CLF).

Recognizing coal production in America will decline for Cliffs, and the production costs will rise, FBR did lower its earnings per share estimates.

"We are lowering our 2010 EPS/EBITDA estimates on CLF to $7.08/$1,725M, from $7.52/$1,808M, primarily to reflect the company's reduced North American coal guidance, with lower volumes (by 0.6 MTs), lower realized pricing, and higher costs. The revised guidance is not comparable to previously announced guidance for pricing and costs as the company is now including the effect of the INR Energy acquisition. We are leaving our 2011 estimates largely unchanged for now," said FBR.

FBR has a price target of $81 on Cliffs.

Cliffs closed Tuesday at $63.18 a share, down $4.37, or 6.47 percent.

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