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Peabody Energy raised to Buy at B. Riley on 'compelling' valuation
Peabody Energy fell 0.5% on Monday even though B. Riley upgraded the stock to Buy from Neutral with a $30 price target, citing compelling valuation and thermal coal dynamics it says are not fully priced in.
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What happened
Peabody Energy fell 0.5% on Monday even though B. Riley upgraded the stock to Buy from Neutral with a $30 price target, citing compelling valuation and thermal coal dynamics it says are not fully priced in.
Confirmed
Global impact / market context
An upgrade means a broker now expects the share price to rise, so the $30 target signals more room than the market currently offers. Still-high costs for diesel and mining could keep profit weak until thermal coal gains and the Centurion project make progress.
Analyst inference
The PLV benchmark price is $267 per metric ton, a key reference for coal sold overseas. Price direction depends on Chinese Shanxi supply, Indian demand, Australia's wet season and European steel furnace use, so the upgrade rests on uncertain near-term forces.
Analyst inference
What to watch
- Peabody's third-quarter earnings report and fourth-quarter outlook are expected to show still-elevated costs across all segments, with diesel prices staying high, which B. Riley says investors likely already expect. Confirmed
- B. Riley's Q4 adjusted EBITDA estimate is $168M, below consensus, and assumes higher costs continue into 2027; watch whether actual results land near this figure or surprise on either side. Proposed
- Watch for signs of recovery in Chinese Shanxi supply, stronger post-monsoon Indian demand, Australian wet-season disruptions and higher European blast furnace use, since these drive the PLV benchmark price that supports the upgrade. Analyst inference