It said key met coal producers were yet to materially increase their FY19 earnings guidance.
"Met coal prices have outperformed expectations over the last six months," Bell Potter analyst Stuart Howe said.
"In the June 2019 quarter, hard coking coal prices averaged US$203 per tonne and thermal coal prices around $80/t. Compared with our forecasts for the period, HCC was 5% higher and thermal coal 5% lower."
Bell Potter said short-term dividend distributions by met coal producers enjoying those higher prices such as Whitehaven Coal, Stanmore Coal and Coronado Global Resources should be balanced against a more subdued outlook for the next 12 to 24 months.
"FY20 will likely see cost pressures increase and the market generally expects coal prices to moderate," it said.
"Key growth projects to offset adverse cost and price effects are not expected until FY21-23."
However, Bell Potter said it still believed coal equities were trading on discounts to fundamental value and modest multiples on a 12-month outlook.
Bell Potter prefers Coronado and Stanmore over Whitehaven.
The firm retained a buy rating for all three producers, as well as a speculative buy rating for Bathurst Resources.