Alliance Holdings GP, L.P. (NASDAQ:AHGP)

CAPS Rating: 5 out of 5

The Company is a producer and marketer of steam coal to United States utilities and industrial users.

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Player Avatar johnguerrero79 (< 20) Submitted: 7/31/2012 7:26:20 AM : Outperform Start Price: $44.23 AHGP Score: +18.14

Using DCF model, this stock is currently selling at slightly above what i would buy it ($45.18). I used a discount rate of 10% (1.44 risk free rate + 8% equity risk premium). Over the past 6 years, AHGP was able to grow EPS by 17% per year. However, I used 10% to increase the margin of safety. This resulted in the stock price i mentioned above.

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