Saying a growing number of investors in small-cap stocks will consider Cloud Peak Energy (NYSE:CLD) a core holding, FBR Capital initiated coverage on them with a "Market Perform."
"We believe that the PRB is now structurally positioned to better participate in the current coal cycle, both in duration and price parity, than in the first three coal cycles. Cloud Peak operates three large coal mines in the southern and northern PRB, led by an international and multi-commodity experienced management team. The stock has performed extremely well, and, as a result, we are initiating coverage with a MP rating. We believe, however, that CLD will become a core holding for small-cap investors given its large footprint and evolving PRB outlook," said FBR Capital.
Cloud closed Friday at $18.48, gaining $0.20, or 1.09 percent. FBR has a price target of $21 on the coal miner.
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