MacArthur Rejects Peabody Energy’s Takeover Bid; Peabody to Look Elsewhere (BTU)

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Coal producer Peabody Energy Corporation ( BTU ) early Tuesday saw its $3.5 billion bid to take over Australian mining company MacArthur Coal rejected, prompting the company to turn its attention elsewhere in search of growth prospects.

"The Macarthur Board has … formed the view that based on the price and the conditions of the proposal, that it cannot reasonably be recommended to shareholders," said MacArthur in a statement.

Countering, Peabody said that it "looks forward to advancing its internal growth projects and continuing to pursue other value-added investments to serve high demand markets." The company had pursued the Australian mining giant since March.

Peabody shares were mostly flat in premarket trading Tuesday.

The Bottom Line
We had removed shares of BTU from our recommended list on Apr.19, when the stock was trading at $46.02. The company has a .71% dividend yield, based on last night's closing stock price of $39.61. The stock has technical support in the $35-$37 price area. If the shares can firm up, we see overhead resistance around the $44-$45 price levels. We would remain on the sidelines for now.

Peabody Energy Corporation ( BTU ) is not recommended at this time, holding a DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Stocks

Referenced Stocks: BTU

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