Pre-Market Activity Shows Gains For Peabody Energy (BTU)

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Peabody Energy ( BTU) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Peabody Energy as such a stock due to the following factors:

  • BTU has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $154.0 million.
  • BTU traded 10,769 shares today in the pre-market hours as of 8:18 AM.
  • BTU is up 3.4% today from yesterday's close.

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More details on BTU:

Peabody Energy Corporation is engaged in the mining of coal. The company operates through Western U.S. Mining, Midwestern U.S. Mining, Australian Mining, Trading and Brokerage, and Corporate and Other segments. The stock currently has a dividend yield of 1.9%. Currently there are 11 analysts that rate Peabody Energy a buy, 1 analyst rates it a sell, and 6 rate it a hold.

The average volume for Peabody Energy has been 7.4 million shares per day over the past 30 days. Peabody Energy has a market cap of $5.0 billion and is part of the basic materials sector and metals & mining industry. The stock has a beta of 2.09 and a short float of 11.2% with 2.93 days to cover. Shares are down 6% year-to-date as of the close of trading on Thursday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Peabody Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 107.3% when compared to the same quarter one year ago, falling from -$23.40 million to -$48.50 million.
  • The debt-to-equity ratio of 1.49 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, BTU has a quick ratio of 0.60, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • The gross profit margin for PEABODY ENERGY CORP is currently extremely low, coming in at 14.26%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.98% trails that of the industry average.
  • The share price of PEABODY ENERGY CORP has not done very well: it is down 12.16% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Oil, Gas & Consumable Fuels industry and the overall market, PEABODY ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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