St. Louis, MS based Peabody Energy Corporation (BTU) is the world’s largest private sector coal mining company, owning majority interests in 28 mines in the U.S. and Australia.
Peabody’s Australian platform provides it with an added competitive advantage as against its solely North America based peers. The company has 10 mine sites in Australia, which are primarily open-cut mines and are less expensive to operate than underground mines. This lowers the overall cost of operations.
Peabody’s exposure to both thermal and metallurgical (met) coal definitely helps, however, the company is presently going through a rough phase as increasing usage of natural gas and alternative energy is steadily eating into coal’s share in power generation
Estimate Trend & Surprise History
Investors should note that the Zacks Consensus Estimate for the first quarter of a loss of 33 cents per share has widened 37.5% over the last 90 days.
Coming to the earnings surprise, Peabody Energy has surpassed the Zacks Consensus Estimate in one of the last four quarters, however, due to wider negative surprise in first quarter of 2014, resulting in a negative average surprise of 506.38%.
Zacks Rank: Currently, Peabody Energy has a Zacks Rank#3 (Hold) but that could change following its first quarter 2015 earnings report which has just released. We have highlighted some of the key details from the just-released announcement below:
Earnings: Peabody Energy’s loss is much wider than expected. Adjusted Loss per share came in at 62 cents, wider than the Zacks Consensus Estimate of 33 cents.
Revenue: Revenues of $1,537.9 million lagged the Zacks Consensus Estimate of $1,610 million but decreased 5.5% year over year.
Key Stats: Peabody Energy reported lower sales volumes for the reported quarter owing to softness in Midwestern U.S. Mining operations and Trading and Brokerage operations. It also witnessed decline in revenue during the quarter affected by lower realized price of coal sold in Australia and Midwestern U.S.
Stock Price: Peabody Energy shares lost nearly 1.6% during pre-market trading. It would be interesting to see how the market reacts to the softer results during the trading session today.
Check back later for our full write up on this BTU earnings report later!
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