Peabody Energy Corp
) will release its third quarter 2013 financial results before
the market bell on Oct 17, 2013. In the prior quarter, this coal
operator reported a positive earnings surprise of 760%. Peabody
currently has a Zacks Rank #2 (Buy). Let's see how things are
shaping up at Peabody prior to this announcement.
Factors to Consider This Quarter
Peabody has an advantage over its domestic peers due to its
exposure in the prime coal producing regions of the U.S. besides
its presence in Australia. Tapping the demand in South East Asian
countries will help the company to counter any decline in
domestic coal demand.
Also, the change in top management during the reported quarter is
expected to bring fresh ideas to the board room.
All the coal miners in the U.S. will be affected to some extent
by the Climate plan announced by the U.S. President. In addition,
the U.S. Environmental Protection Agency's (EPA's) proposed rule
for setting up new coal fired plants could lower the demand for
coal as a power source.
Our proven model does not conclusively show that Peabody Energy
is likely to beat earnings this quarter. That is because a stock
needs to have both a positive earnings Expected Surprise
Prediction (ESP) (Read:
Zacks Earnings ESP: A Better Method
) and a Zacks Rank #1, 2 or 3 for this to happen. This is not the
: Earnings ESP, which represents the difference between the Most
Accurate estimate and the Zacks Consensus Estimate, is at
Zacks Rank #2 (Buy)
: Though Peabody has a bullish Zacks Rank #2 (Buy), the
unfavorable earnings ESP makes a beat unlikely this quarter.
Other Stocks to Consider
Here are some companies tied to the coal industry worth
considering on the basis of our model, which shows that they have
the right combination of elements to post an earnings beat this
Suncoke Energy Partners, L.P.
) has earnings ESP of +12.50% and carries a Zacks Rank #2 (Buy).
Alliance Resource Partners L.P.
) has earnings ESP of +10.29% and carries a Zacks Rank #3 (Hold).
Arch Coal Inc.
) has earnings ESP of +9.68% and carries a Zacks Rank #3
ARCH COAL INC (ACI): Free Stock Analysis
ALLIANCE RES (ARLP): Free Stock Analysis
PEABODY ENERGY (BTU): Free Stock Analysis
SUNCOKE ENERGY (SXCP): Free Stock Analysis
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