BTU  Peabody Energy Corporation

Exchange

NYSE

Sector

Energy

Industry

Coal Mining

Market Cap.

37.67M

Vuru Grade

6.12/100

Current Price

$2.07
+0.00 (+0.00%)

Company Metrics

  • P/E 10.48
  • P/S 0.01
  • P/B 0.04
  • EPS -112.96
  • Cash ROIC 0.31%
  • Cash Ratio 0.04
  • Dividend 0 / 0%
  • Avg. Vol. 3.25M
  • Shares 18.20M
  • Market Cap. 37.67M

Company Description

Peabody Energy Corporation, through its subsidiaries, engages in the exploration, mining, and production of coal. The company mines and sells thermal coal to electric utilities and metallurgical coal to industrial customers. It owns interests in 28 coal operations located in the United States and Australia, as well as owns joint venture interests in a Venezuelan mine. The company also markets, bro... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Coal Slump Sends Mining Giant Peabody Energy Into Bankruptcy
Bloomberg - Apr 13, 2016
Peabody Energy Corp. filed for bankruptcy on Wednesday, the most powerful convulsion yet in an industry that's still waiting for the coal market to bottom out.
Peabody Energy: Post Mortem - Seeking Alpha
Peabody Energy Files for Chapter 11 Bankruptcy Protection - Wall Street Journal
Peabody Energy Shareholders Are Getting Nothing Under A Reorganization Plan
Seeking Alpha - Dec 23, 2016
Peabody Energy Corp. (OTCPK:BTUUQ) filed a reorganization plan (docket 1280) late on December 22 that gives no recovery to shareholders and no recovery for convertible bond holders.
Peabody Energy reorganization plan lacks mine cleanup coverage details - Reuters
Peabody Energy files bankruptcy exit plan - St. Louis Business Journal
My Peabody Energy Misadventure Ends
Seeking Alpha - May 26, 2016
Last week I sold all 255 of my Peabody Energy bonds for $10.72 net of commissions. I lost $51,300 on an $81,200 investment.
Former Peabody Energy Senior Executive Questions Management's Fiduciary Behavior
Seeking Alpha - Jan 13, 2017
As many Seeking Alpha readers know, I was one of the leading forces behind the Peabody Energy unsecured bond bullish camp from the summer of 2015 - through the late May 2016.
Peabody Energy Is Imploding
Seeking Alpha - Jun 27, 2016
Peabody Energy Corp (OTCPK: OTCPK:BTUUQ) is imploding. Australian operations could soon go into administration. The equity that the U.S.
Reality And Hype For Peabody Energy
Seeking Alpha - Oct 24, 2016
Peabody Energy's dramatic share and bond price recovery, based on a Chinese miscalculation and high-stakes investor gambles, or a real change in coal's prospects?
Peabody Energy Stock Price Triples This Week - What's Up?
Seeking Alpha - Oct 21, 2016
Peabody Energy Corp. (OTCPK:BTUUQ) has tripled in price the last few days and the debt prices continue their climb. Call option prices are soaring.
Peabody Energy (BTUUQ) Shares Active After Filing of Monthly Operating Report - StreetInsider.com
Bankruptcy judge denies request for Peabody equity committee
Reuters - Jan 19, 2017
LOUIS A U.S. bankruptcy judge denied on Thursday a request by Peabody Energy Corp (BTUUQ.PK) shareholders to order the appointment of an official equity committee in the coal miner's Chapter 11 restructuring, crushing hopes of a recovery for investors.
Peabody Energy's Bankruptcy Judge Rules In Favor Of The Hedge Funds And Management - Seeking Alpha
Peabody Energy Corporation (OTCMKTS:BTUUQ) Stomps Out the Embers - The Oracle Dispatch
Peabody Energy Files Financial Projections
Seeking Alpha - Jan 17, 2017
Peabody Energy Corp. (OTCPK:BTUUQ) finally filled its amended disclosure statement (docket 2019) that included financial projections, but as expected, it did not include a valuation exhibit.
Finding Value In Peabody Energy's Bankruptcy For Investors
Seeking Alpha - May 18, 2016
There is a major disagreement as to how much 1liens are secured and possible assets available to unsecured holders. Australian operations seem to possibly be headed towards going into administration.
Peabody Energy Receives Final Court Approval Of $800 Million DIP Financing ... - PR Newswire (press release)
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for BTU to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate BTU's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$2.07 Current Price

$-2.80 Growth Price (DCF)

Why is this negative?


Show Free Cash Flow numbers

$133.21 Book Price

Undervalued by 6,335.32%


Poor Cash Return on Invested Capital over the past 5 years

BTU has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

BTU has only created $0.31 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20112012201320142015
Free Cash Flow 786.30M 252.60M -3.50M -151.10M -150.40M
divided by
Invested Capital 14.11B 13.58B 11.91B 11.03B 3.37B
Cash ROIC 5.57% 1.86% -0.03% -1.37% -4.47%

Very Poor Return on Equity over the past 5 years

BTU has shown an inability to deliver results for shareholders. This could be due to poor management, BTU operating in a highly competitive industry, or having a weak business in general.

BTU has generated a $50.61 loss for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20112012201320142015
Net Income 946.30M -575.10M -512.60M -777.30M -1.99B
divided by
Stockholders' Equity 5.49B 4.90B 3.91B 2.72B 916.90M
Return on Equity 17.25% -11.73% -13.11% -28.53% -216.92%

Mediocre Business Performance over the past 10 years

BTU isn't a strong business and might be consistently attempting to fuel growth with debt or has trouble staying profitable. The lack of predictability in free cash flow should be concerning for the reliability of future earnings.

BTU has been unable to consistently create value for shareholders.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow -60.19M -154.07M 841.00M 924.30M 1.09B 786.30M 252.60M -3.50M -151.10M -150.40M

Weak Balance Sheet

BTU's financial position is not ideal. The key is to check whether BTU is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Cash 326.51M 45.28M 449.70M 988.80M 1.30B 799.10M 558.80M 444.00M 298.00M 261.30M
Current Assets 1.27B 1.93B 1.97B 2.19B 2.96B 3.01B 2.58B 1.99B 1.71B 1.38B
Total Assets 9.51B 9.67B 9.82B 9.96B 11.36B 16.73B 15.81B 14.13B 13.19B 11.02B
Current Liabilities 1.37B 2.19B 1.86B 1.31B 1.51B 1.82B 1.67B 1.78B 1.86B 7.39B
Total Liabilities 7.18B 7.15B 6.92B 6.21B 6.70B 11.25B 10.90B 10.22B 10.47B 10.10B
Stockholder' Equity 2.34B 2.52B 2.90B 3.75B 4.66B 5.49B 4.90B 3.91B 2.72B 916.90M
Current Ratio 0.93 0.88 1.06 1.67 1.95 1.65 1.54 1.12 0.92 0.19
TL-to-TA 0.75 0.74 0.70 0.62 0.59 0.67 0.69 0.72 0.79 0.92

Low or No Reinvestment of Profits over the past 10 years

BTU has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to BTU operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings 1.12B 941.42M 1.80B 2.18B 2.88B 3.74B 3.07B 2.45B 1.57B -503.40M
Retained Earnings Growth - -15.64% 91.57% 21.09% 31.81% 30.07% -18.10% -20.11% -35.89% -132.05%

Highly Competitive Industry over the past 10 years

It's likely that BTU is in an industry with low barriers to entry, spurring high competition. If Gross Margins are at least satisfactory, it's likely BTU invests heavily in R&D and Sales, General & Administrative expenses.

Only $0.16 of every $100 of Revenue have been profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income 600.70M 264.29M 953.50M 463.00M 802.20M 946.30M -575.10M -512.60M -777.30M -1.99B
divided by
Revenue 5.26B 4.57B 6.59B 6.01B 6.86B 7.97B 8.08B 7.01B 6.79B 5.61B
Net Profit Margin 11.43% 5.78% 14.46% 7.70% 11.69% 11.87% -7.12% -7.31% -11.44% -35.46%

Inconsistent Gross Profit Margins over the past 10 years

BTU has good gross profit margins, however inconsistency of these margins is a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$29.92 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit 1.10B 999.89M 1.98B 1.54B 2.02B 7.97B 2.14B 1.28B 1.08B 601.50M
divided by
Revenue 5.26B 4.57B 6.59B 6.01B 6.86B 7.97B 8.08B 7.01B 6.79B 5.61B
Gross Margin 20.93% 21.86% 29.97% 25.69% 29.43% 100.00% 26.55% 18.22% 15.83% 10.72%

High Capital Intensity over the past 10 years

BTU spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

90.00% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure 655.91M 470.43M 444.70M 123.60M - 846.90M 1.26B 725.90M 487.70M 136.00M
divided by
Net Income 600.70M 264.29M 953.50M 463.00M 802.20M 946.30M -575.10M -512.60M -777.30M -1.99B
Capital Expenditure Ratio 109.19% 178.00% 46.64% 26.70% - 89.50% -219.53% -141.61% -62.74% -6.84%

Very Strong Dividend History over the past 10 years

BTU has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests BTU is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid 63.46M 63.66M 64.90M 66.80M 79.40M 92.10M 91.90M 91.70M 92.30M 1.40M
divided by
Shares Outstanding 269.17M 269.17M 271.28M 267.50M 269.90M 270.30M 268.00M 267.10M 268.10M 18.10M
Dividend Paid Per Share 0.24 0.24 0.24 0.25 0.29 0.34 0.34 0.34 0.34 0.08
Price at Year End 36.62 59.71 22.00 45.35 63.67 33.04 25.36 19.23 7.76 8.03
Dividend Yield 0.64% 0.40% 1.09% 0.55% 0.46% 1.03% 1.35% 1.79% 4.44% 0.96%

History of Stock Buybacks over the past 10 years

BTU has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 269.17M 269.17M 271.28M 267.50M 269.90M 270.30M 268.00M 267.10M 268.10M 18.10M
Stock Bought Back - -0.00% -0.78% 1.41% -0.89% -0.15% 0.86% 0.34% -0.37% 1,381.22%
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