Peabody Energy’s “Outperform” Rating Reiterated by FBR Capital (BTU)


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Coal miner Peabody Energy Corporation ( BTU ) saw its "Outperform" rating reiterated on Tuesday by analysts at FBR Capital Markets.

The firm also reaffirmed its $65 price target on BTU, which would represent a massive 53% upside to the stock's Monday closing price of $42.32.

An FBR analyst commented, "Peabody hosted its 2010 Analyst and Investor Forum last week and reinforced why we have it as our Top Pick: deep management bench, solid value, outstanding liquidity, organic and M&A growth, valuation, and trading and marketing differential. Both growth and value investors should be attracted to Peabody given all the facets of the company. Few companies (and especially coal companies) can give investors a 10-year view, given the fast depletion curves, limited liquidity, and challenging competition for reserves."

Peabody Energy shares fell 72 cents, or -1.7%, 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 .66% dividend yield, based on last night's closing stock price of $42.32. The stock has technical support in the $36-$40 price area. If the shares can firm up, we see overhead resistance around the $45-$46 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 3.3 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 Nasdaq, Inc.

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