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Reasons to Add Peabody Energy (BTU) to Your Portfolio Now
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Peabody Energy Corporation (BTU - Free Report) continues to benefit from its low-cost U.S. thermal coal mines. The company also benefits from its continued debt reduction initiatives and share repurchase program. Given its growth opportunities, BTU makes for a solid investment option in the coal industry.
Let’s focus on the factors that make this Zacks Rank #1 (Strong Buy) company a strong investment pick at the moment.
Growth Projections & Surprise History
The Zacks Consensus Estimate for BTU’s 2023 earnings per share (EPS) has increased 5.4% to $4.87 in the past 30 days.
The Zacks Consensus Estimate for BTU’s 2024 EPS has increased 44.3% to $3.29 in the past 30 days.
The company delivered an average earnings surprise of 8.5% in the last four quarters.
Return on Equity
Return on equity (ROE) indicates how efficiently a company has been utilizing its funds to generate higher returns. Currently, Peabody Energy’s ROE is 35.81%, higher than the sector’s average of 25.84%. This indicates that the company has been utilizing its funds more constructively than its peers in the oils-energy sector.
Debt Position & Liquidity
Currently, Peabody Energy’s total debt to capital is 8.67%, much better than the industry’s average of 16.05%.
The current ratio at the end of the second quarter was 2.17. The ratio, being greater than one, indicates the company’s ability to meet future short-term liabilities without difficulties.
Share Repurchase Program
On Apr 17, 2023, BTU announced that its board of directors authorized a new share repurchase program authorizing repurchases of up to $1 billion of its common stock.
Through Jun 30, 2023, the company had repurchased 8.9 million shares of its common stock under the current repurchase program for $184.2 million, including $11.2 million of unsettled share repurchases and $0.2 million of paid commissions, leaving $816.0 million for share repurchase. Following Jun 30, 2023, BTU purchased an additional 3.1 million shares of its common stock for $67 million.
Price Performance
In the past month, BTU’s shares have rallied 8.9% compared with the industry’s average growth of 8.1%.
The Zacks Consensus Estimate for HCC’s 2023 EPS has increased 10.9% to $9.29 in the past 30 days. It delivered an average earnings surprise of 11.4% in the last four quarters.
The Zacks Consensus Estimate for METC’s 2023 EPS has increased 20.7% to $1.69 in the past 30 days. The Zacks Consensus Estimate for 2023 sales indicates a year-over-year improvement of 8.7%.
CEG’s long-term earnings growth rate is 23.3%. The Zacks Consensus Estimate for 2023 EPS indicates a year-over-year improvement of 1,216.3%.
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Reasons to Add Peabody Energy (BTU) to Your Portfolio Now
Peabody Energy Corporation (BTU - Free Report) continues to benefit from its low-cost U.S. thermal coal mines. The company also benefits from its continued debt reduction initiatives and share repurchase program. Given its growth opportunities, BTU makes for a solid investment option in the coal industry.
Let’s focus on the factors that make this Zacks Rank #1 (Strong Buy) company a strong investment pick at the moment.
Growth Projections & Surprise History
The Zacks Consensus Estimate for BTU’s 2023 earnings per share (EPS) has increased 5.4% to $4.87 in the past 30 days.
The Zacks Consensus Estimate for BTU’s 2024 EPS has increased 44.3% to $3.29 in the past 30 days.
The company delivered an average earnings surprise of 8.5% in the last four quarters.
Return on Equity
Return on equity (ROE) indicates how efficiently a company has been utilizing its funds to generate higher returns. Currently, Peabody Energy’s ROE is 35.81%, higher than the sector’s average of 25.84%. This indicates that the company has been utilizing its funds more constructively than its peers in the oils-energy sector.
Debt Position & Liquidity
Currently, Peabody Energy’s total debt to capital is 8.67%, much better than the industry’s average of 16.05%.
The current ratio at the end of the second quarter was 2.17. The ratio, being greater than one, indicates the company’s ability to meet future short-term liabilities without difficulties.
Share Repurchase Program
On Apr 17, 2023, BTU announced that its board of directors authorized a new share repurchase program authorizing repurchases of up to $1 billion of its common stock.
Through Jun 30, 2023, the company had repurchased 8.9 million shares of its common stock under the current repurchase program for $184.2 million, including $11.2 million of unsettled share repurchases and $0.2 million of paid commissions, leaving $816.0 million for share repurchase. Following Jun 30, 2023, BTU purchased an additional 3.1 million shares of its common stock for $67 million.
Price Performance
In the past month, BTU’s shares have rallied 8.9% compared with the industry’s average growth of 8.1%.
Image Source: Zacks Investment Research
Other Stocks to Consider
A few other top-ranked stocks from the same sector are Warrior Met Coal (HCC - Free Report) , Ramaco Resources (METC - Free Report) and Constellation Energy Corporation (CEG - Free Report) , each sporting a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for HCC’s 2023 EPS has increased 10.9% to $9.29 in the past 30 days. It delivered an average earnings surprise of 11.4% in the last four quarters.
The Zacks Consensus Estimate for METC’s 2023 EPS has increased 20.7% to $1.69 in the past 30 days. The Zacks Consensus Estimate for 2023 sales indicates a year-over-year improvement of 8.7%.
CEG’s long-term earnings growth rate is 23.3%. The Zacks Consensus Estimate for 2023 EPS indicates a year-over-year improvement of 1,216.3%.