FBR Capital reiterated their "Outperform" rating on Peabody Energy (NYSE:BTU), citing their strong performance in the third quarter. They also raised their earnings estimates for 2010-2012.
"This morning, we are increasing our 2010–2012 earnings estimates (EBITDA) on Peabody by about 2% after the company announced solid 3Q10 earnings, raised 2010 guidance, and sold additional coal at prices above expectations and in line with the forward curve. We continue to believe that Peabody is well positioned to benefit from growing seaborne demand and relatively less exposure to regulatory challenges domestically, where the company is also largely sold out for 2011. While the company's implied 4Q10 guidance may seem light, we remain focused on the key long-term catalysts for the company," said FBR.
"We are increasing our 2010 EPS/EBITDA estimates to $3.11/$1,884M, from
$2.99/$1,838M...We are also increasing our 2011 estimates to $4.00/$2,210M, from $3.83/$2,132M."
FBR has a price target of $61 on Peabody.
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