Peabody Energy Corporation (NYSE: BTU) and Arch Coal, Inc. Class A (NASDAQ:ARCH) are both oils/energy companies, but which is the superior investment? We will compare the two companies based on the strength of their profitabiliy, valuation, analyst recommendations, dividends, institutional ownership, risk and earnings.

Analyst Ratings

This is a breakdown of recent ratings and price targets for Peabody Energy Corporation and Arch Coal, Inc. Class A, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Peabody Energy Corporation 0 2 5 0 2.71
Arch Coal, Inc. Class A 0 1 6 0 2.86

Peabody Energy Corporation currently has a consensus target price of $35.57, indicating a potential upside of 26.05%. Arch Coal, Inc. Class A has a consensus target price of $94.20, indicating a potential upside of 24.59%. Given Peabody Energy Corporation’s higher probable upside, equities analysts plainly believe Peabody Energy Corporation is more favorable than Arch Coal, Inc. Class A.

Insider and Institutional Ownership

0.1% of Peabody Energy Corporation shares are held by institutional investors. 1.3% of Peabody Energy Corporation shares are held by company insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a company is poised for long-term growth.

Valuation and Earnings

This table compares Peabody Energy Corporation and Arch Coal, Inc. Class A’s revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
Peabody Energy Corporation $5.24 billion 0.52 $978.90 million N/A N/A
Arch Coal, Inc. Class A $2.23 billion 0.82 $382.34 million N/A N/A

Peabody Energy Corporation has higher revenue and earnings than Arch Coal, Inc. Class A.

Profitability

This table compares Peabody Energy Corporation and Arch Coal, Inc. Class A’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Peabody Energy Corporation N/A N/A N/A
Arch Coal, Inc. Class A N/A N/A N/A

Summary

Peabody Energy Corporation beats Arch Coal, Inc. Class A on 5 of the 8 factors compared between the two stocks.

Peabody Energy Corporation Company Profile

Peabody Energy Corporation is a coal company. The Company’s segments include Powder River Basin Mining, Midwestern U.S. Mining, Western U.S. Mining, Australian Metallurgical Mining, Australian Thermal Mining, Trading and Brokerage, and Corporate and Other. Its Powder River Basin Mining operations consist of its mines in Wyoming. Midwestern U.S. Mining operations reflect the Company‚Äôs Illinois and Indiana mining operations. Western U.S. Mining operations reflect the aggregation of the New Mexico, Arizona and Colorado mining operations. Australian Metallurgical Mining operations consist of mines in Queensland and New South Wales, Australia. Australian Thermal Mining operations consist of mines in New South Wales, Australia. Its Trading and Brokerage segment engages in the direct and brokered trading of coal and freight-related contracts through the trading and business offices. Its Corporate and Other includes selling and administrative expenses, and corporate hedging activities.

Arch Coal, Inc. Class A Company Profile

Arch Coal, Inc. is a coal producer. The Company is engaged in the production of thermal and metallurgical coal from surface and underground mines located throughout the United States, for sale to utility, industrial and steel producers both in the United States and around the world. The Company operates mining complexes in West Virginia, Kentucky, Maryland, Virginia, Illinois, Wyoming and Colorado. The Company’s segments include the Powder River Basin and Appalachia. The Powder River Basin segment includes operations in Wyoming. The Appalachia segment includes operations in West Virginia, Kentucky, Maryland and Virginia. The Company also sells coal from operations in Colorado and Illinois. Powder River Basin consists of Black Thunder and Coal Creek mines. The Company’s mines in Appalachia include Coal-Mac, Lone Mountain, Mountain Laurel, Beckley, Vindex, Sentinel and Leer. The Company operates, or contracts out the operation of approximately 10 active mines in the United States.

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