BTU  Peabody Energy Corporation

Exchange

NYSE

Sector

Energy

Industry

Coal Mining

Market Cap.

37.67M

Vuru Grade

4.50/100

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 -1.18%
  • Cash Ratio 0.86
  • 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

Dangerous Legal Precedent Set By Peabody Energy
Seeking Alpha - 6 hours ago
The confirmation of the Peabody Energy reorganization plan now in appeal has set a dangerous legal precedent. Now there are co-proponents developing reorganization plans for other companies such as Breitburn Energy Partners where they also are trying ...
Sentiment Turns Bullish on Peabody Energy Corporation (OTCMKTS:BTUUQ) - The Oracle Dispatch
Peabody Energy: Do The Numbers Work Post-Bankruptcy?
Seeking Alpha - Mar 23, 2017
In the U.S., gas and renewable energy are a major problem. Pay attention to where Peabody will sell its coal. Peabody thinks it is going to sell coal at expense of its competitors, and has ambitions for Powder Rover Basin and Western coal production ...
US, Peabody Energy Agree to $43 Million Environmental Fund; Bankruptcy Plan ...
Insurance Journal - Mar 20, 2017
A U.S. judge formally approved Peabody Energy Corp.'s plan to emerge from bankruptcy late Friday after the coal producer struck a settlement with the U.S.
What Will Happen to Common Shares of Peabody Energy Corporation (OTCMKTS:BTUUQ) - The Oracle Dispatch
Judge approves Peabody's bankruptcy exit plan - St. Louis Business Journal
Peabody is dead. Long live Peabody.
Seeking Alpha - Mar 21, 2017
"As frequently occurs in Chapter 11 processes, the plan provides that current Peabody Energy equity securities will be cancelled and extinguished upon the effective date of a confirmed plan of reorganization by the bankruptcy court, and holders would ...
Peabody Energy's Reorganization Plan To Be Confirmed March 16
Seeking Alpha - Mar 13, 2017
The bankruptcy judge will, in my opinion, confirm the bankruptcy reorganization plan of Peabody Energy Corp. (OTCPK:BTUUQ) after a hearing on March 16.
Peabody Energy: Shareholders Lose, But Will Anyone Win?
Seeking Alpha - Jan 27, 2017
Potential roadblocks: Rearguard action from shareholder group; litigation by Berenergy Corp.; and issues about mine cleanup.
Peabody gets US court approval to pursue reorganization - Reuters
Peabody Energy: Secures Approval to Exit Chapter 11 - TCC
Former Peabody Energy Senior Executive Questions Management's Fiduciary Behavior
Seeking Alpha - Jan 13, 2017
He shares his in-depth nine-page analysis on why Peabody's debt could be reinstated and why shareholders don't need to be wiped out.
Alternative bankruptcy plan could 'imperil' Peabody: court paper
Reuters - Jan 24, 2017
CHICAGO Peabody Energy Corp (BTUUQ.PK), the world's largest private sector coal producer, stood by its current bankruptcy exit plan on Tuesday, saying in court papers that alternative proposals threatened to send the company back into Chapter 11.
Lease dispute could put Peabody reorganization at risk: Report - St. Louis Business Journal
Alternative bankruptcy plan could 'imperil' Peabody, company warns in court ... - STLtoday.com
Back to Black on Peabody Energy Corporation(OTCMKTS:BTUUQ)
MicroCap Daily - Mar 12, 2017
Peabody Energy Corporation(OTCMKTS:BTUUQ) is back where it started around $2 a share after the spectacular rise and fall to $18.75 a share in the final months of last year.
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 Completes Key Milestone Toward Emergence From Chapter 11; Files ... - 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

$-47.46 Growth Price (DCF)

Why is this negative?


Show Free Cash Flow numbers

$42.19 Book Price

Undervalued by 1,938.37%


Very Poor Cash Return on Invested Capital over the past 5 years

BTU has failed to generate positive returns on 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 lost $1.18 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow 252.60M -3.50M -151.10M -150.40M -185.50M
divided by
Invested Capital 13.58B 11.91B 11.03B 3.37B 9.89B
Cash ROIC 1.86% -0.03% -1.37% -4.47% -1.87%

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 $98.39 loss for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income -575.10M -512.60M -777.30M -1.99B -731.90M
divided by
Stockholders' Equity 4.90B 3.91B 2.72B 916.90M 330.20M
Return on Equity -11.73% -13.11% -28.53% -216.92% -221.65%

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
2007200820092010201120122013201420152016
Free Cash Flow -154.07M 841.00M 924.30M 1.09B 786.30M 252.60M -3.50M -151.10M -150.40M -185.50M

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
2007200820092010201120122013201420152016
Cash 45.28M 449.70M 988.80M 1.30B 799.10M 558.80M 444.00M 298.00M 261.30M 872.30M
Current Assets 1.93B 1.97B 2.19B 2.96B 3.01B 2.58B 1.99B 1.71B 1.38B 2.09B
Total Assets 9.67B 9.82B 9.96B 11.36B 16.73B 15.81B 14.13B 13.19B 11.02B 11.78B
Current Liabilities 2.19B 1.86B 1.31B 1.51B 1.82B 1.67B 1.78B 1.86B 7.39B 1.01B
Total Liabilities 7.15B 6.92B 6.21B 6.70B 11.25B 10.90B 10.22B 10.47B 10.10B 11.45B
Stockholder' Equity 2.52B 2.90B 3.75B 4.66B 5.49B 4.90B 3.91B 2.72B 916.90M 330.20M
Current Ratio 0.88 1.06 1.67 1.95 1.65 1.54 1.12 0.92 0.19 2.07
TL-to-TA 0.74 0.70 0.62 0.59 0.67 0.69 0.72 0.79 0.92 0.97

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
2007200820092010201120122013201420152016
Retained Earnings 941.42M 1.80B 2.18B 2.88B 3.74B 3.07B 2.45B 1.57B -503.40M -1.24B
Retained Earnings Growth - 91.57% 21.09% 31.81% 30.07% -18.10% -20.11% -35.89% -132.05% -146.96%

Loss Making Entity over the past 10 years

BTU has been unable to maintain profitability. It's Costs of Sales have outstripped Revenue consistently. This is a huge red flag, unless the company has been investing heavily for the future. However, even that is dubious since accurately predicting the future of a company like that is extremely difficult.

$2.54 of every $100 of Revenue have been a loss, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 264.29M 953.50M 463.00M 802.20M 946.30M -575.10M -512.60M -777.30M -1.99B -731.90M
divided by
Revenue 4.57B 6.59B 6.01B 6.86B 7.97B 8.08B 7.01B 6.79B 5.61B 4.72B
Net Profit Margin 5.78% 14.46% 7.70% 11.69% 11.87% -7.12% -7.31% -11.44% -35.46% -15.52%

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.

$29.12 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
2007200820092010201120122013201420152016
Gross Profit 999.89M 1.98B 1.54B 2.02B 7.97B 2.14B 1.28B 1.08B 601.50M 607.70M
divided by
Revenue 4.57B 6.59B 6.01B 6.86B 7.97B 8.08B 7.01B 6.79B 5.61B 4.72B
Gross Margin 21.86% 29.97% 25.69% 29.43% 100.00% 26.55% 18.22% 15.83% 10.72% 12.89%

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.

85.21% 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
2007200820092010201120122013201420152016
Capital Expenditure 470.43M 444.70M 123.60M - 846.90M 1.26B 725.90M 487.70M 136.00M 132.70M
divided by
Net Income 264.29M 953.50M 463.00M 802.20M 946.30M -575.10M -512.60M -777.30M -1.99B -731.90M
Capital Expenditure Ratio 178.00% 46.64% 26.70% - 89.50% -219.53% -141.61% -62.74% -6.84% -18.13%

Inconsistent Dividend History over the past 10 years

BTU has started distributing dividends in the past couple years or has recently suspended their dividend distribution. The reliability of future distributions is unclear.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid 63.66M 64.90M 66.80M 79.40M 92.10M 91.90M 91.70M 92.30M 1.40M -
divided by
Shares Outstanding 269.17M 271.28M 267.50M 269.90M 270.30M 268.00M 267.10M 268.10M 18.10M 18.30M
Dividend Paid Per Share 0.24 0.24 0.25 0.29 0.34 0.34 0.34 0.34 0.08 -
Price at Year End 59.71 22.00 45.35 63.67 33.04 25.36 19.23 7.76 8.03 2.07
Dividend Yield 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
2007200820092010201120122013201420152016
Shares Outstanding 269.17M 271.28M 267.50M 269.90M 270.30M 268.00M 267.10M 268.10M 18.10M 18.30M
Stock Bought Back - -0.78% 1.41% -0.89% -0.15% 0.86% 0.34% -0.37% 1,381.22% -1.09%
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