Credit Suisse Lower Numbers On Peabody Energy (BTU), But Still Bullish On the Coal Name

Credit Suisse lowered estimates and its price target on Peabody Energy (NYSE: BTU) following results yesterday, but is sticking with their Outperform rating.

2011 EPS estimate were lowered from $6.14 to $4.64, 2012 from $7.69 to $6.59, and 2013 from $7.78 to $6.44. The target price went from $90 to $80.

"We maintain our view that BTU shares represent a compelling risk/reward, even after haircutting our 2011 and 2012 estimates," states analyst D. Gagliano. "Haircuts to full-year estimates are unfortunately a semi-regular occurrence in the coal industry, as the combination of the timing of full-realization of price increases and persistent cost pressures remain an industry-wide issue. However, even with reduced estimates, we believe BTU shares are undervalued within the context of the current met coal pricing environment, and what we believe will be an improving thermal coal pricing environment in 2012 and 2013 when compared with 2011."

For more ratings news on Peabody Energy click here and for the rating history of Peabody Energy click here.

Shares of Peabody Energy closed at $63.67 yesterday.

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