Peabody Energy (NYSE:BTU) Posts Quarterly Earnings Results, Misses Expectations By $0.22 EPS

Key Points

• Peabody missed earnings expectations: It reported a loss of $0.27 per share versus analysts’ expected loss of $0.05, despite revenue of $1.10 billion beating forecasts of $1.03 billion and rising 8.3% year over year.
• Operational outlook was mixed: Delays at the Centurion mine and weak U.S. coal burn led to lower metallurgical and thermal volume guidance, while stronger seaborne thermal performance supported higher export guidance.
• Shares fell 20.6% on Wednesday. Analysts’ consensus rating was Hold, with an average price target of $34.12.

Peabody Energy (NYSE:BTU - Get Free Report) released its quarterly earnings data on Wednesday. The coal producer reported ($0.27) earnings per share for the quarter, missing analysts' consensus estimates of ($0.05) by ($0.22), FiscalAI reports. The business had revenue of $1.10 billion during the quarter, compared to analysts' expectations of $1.03 billion. Peabody Energy had a negative return on equity of 5.22% and a negative net margin of 4.56%. The firm's revenue was up 8.3% compared to the same quarter last year. During the same period last year, the company earned ($0.58) earnings per share.

Here are the key takeaways from Peabody Energy's conference call:

• Centurion’s ramp-up remains delayed. Complex faulting limited October production to just over 45,000 tons, prompting a fourth-quarter sales outlook of 300,000–500,000 tons and a 600,000-ton reduction to full-year metallurgical volume guidance; management says its long-term capacity outlook is unchanged.
• Seaborne thermal performance and markets strengthened. The segment’s adjusted EBITDA rose 60% year over year, and Peabody raised full-year export volume guidance by 200,000 tons, citing higher Wambo production and stronger Newcastle pricing.
• Weak U.S. coal burn weighed on thermal volumes. Peabody lowered full-year Powder River Basin volume guidance by 7.5 million tons and other U.S. thermal guidance by 200,000 tons, while noting that near-term demand depends on weather, gas prices, and renewable generation.
• Adjusted EBITDA improved, and liquidity remained substantial. Third-quarter adjusted EBITDA was $97.5 million, up from the second quarter, and Peabody ended the period with $434 million in cash and $887 million in liquidity; it also reported $192 million returned to shareholders year to date through September.

Peabody Energy Stock Down 20.6%

NYSE:BTU traded down $4.26 during mid-day trading on Wednesday, hitting $16.39. 4,415,048 shares of the company's stock traded hands, compared to its average volume of 2,990,309. The company has a fifty day moving average of $25.54 and a 200 day moving average of $28.04. The company has a debt-to-equity ratio of 0.10, a quick ratio of 1.46 and a current ratio of 2.01. Peabody Energy has a twelve month low of $15.97 and a twelve month high of $41.14. The company has a market capitalization of $2.00 billion, a P/E ratio of -10.93 and a beta of 0.46.

Analysts Set New Price Targets

A number of research firms have weighed in on BTU. B. Riley Financial upgraded Peabody Energy from a "neutral" rating to a "buy" rating and upped their target price for the stock from $29.00 to $30.00 in a report on Monday, October 26th. Zacks Research cut Peabody Energy from a "hold" rating to a "strong sell" rating in a research note on Tuesday, October 27th. UBS Group dropped their price objective on Peabody Energy from $27.00 to $26.50 and set a "neutral" rating on the stock in a research report on Tuesday, August 4th. Weiss Ratings upgraded shares of Peabody Energy from a "sell (d)" rating to a "sell (d+)" rating in a report on Friday, October 2nd. Finally, Benchmark reduced their target price on shares of Peabody Energy from $40.00 to $36.00 and set a "buy" rating for the company in a report on Thursday, July 30th. Three analysts have rated the stock with a Buy rating, one has issued a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat.com, Peabody Energy currently has a consensus rating of "Hold" and an average target price of $34.12.

Peabody Energy Company Profile

Peabody Energy Corp. is a global coal producer and supplier of energy and industrial fuels. The company mines, processes and markets thermal coal, which is primarily used for electricity generation, and metallurgical coal, which is used in steelmaking. Peabody also provides coal-trading and logistics services and works with customers to transport products to domestic and international markets.

Peabody operates mines in the United States and Australia, serving electric utilities, steel producers and other industrial customers.

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