| Why Is Peabody Getting Killed By Reverse Split News? | |
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- Peabody Energy’s stock is down more than 9 percent on Thursday after approval of a reverse split.
- Peabody and rival Arch Coal are two of the largest coal names struggling to avoid bankruptcy.
- Both companies currently sport debt-to-equity ratios of greater than 3.5.
Coal producer Peabody Energy Corporation (NYSE: BTU) shares are plummeting on Thursday after the company announced that its shareholders have approved a 15-1 reverse stock split. The coal industry has been hit particularly hard during the current commodity pricing slump, but the most recent blow is a tough one for Peabody shareholders. Slew Of Bankruptcies Coal investors have endured a minefield of bankruptcies in recent years. Alpha Natural Resources, the second-largest public coal company at the time, filed for Chapter 11 just last month. Alpha joined the bankruptcy ranks of Walter Energy, Patriot Coal, James River Coal and numerous other smaller coal names that have filed for bankruptcy during this downturn. Staying Above Water The financial health of two of the largest remaining coal names, Peabody and rival Arch Coal Inc (NYSE: ACI) remains highly suspect. Both companies currently sport long-term debt-to-equity ratios of greater than 3.5 and have not been generating any profits at current coal prices. Arch’s stock plunged more than 11 percent earlier this week as the company’s efforts to restructure its debt were met with resistance. Market Reacts The market seems to be viewing Peabody’s reverse split as an act of desperation. The stock is trading down more than 9.0 percent on Thursday. Arch is also down more than 2.6 percent on the day. Both stocks are now down more than 85 percent in the past year. Disclosure: the author holds no position in the stocks mentioned. See more from Benzinga © 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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Arch Coal Inc
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PRODUCER |
CODE : ACI |
ISIN : US0393801008 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Arch Coal is a coal producing company based in United states of america. Arch Coal holds various exploration projects in USA. Its main assets in production are WEST ELK, BLACK THUNDER and JACOB'S RANCH in USA and its main asset in development is SPRUCE N° 1 in USA. Arch Coal is listed in Germany and in United States of America. Its market capitalisation is US$ 366 000 as of today (€ 317 981). Its stock quote reached its highest recent level on June 27, 2003 at US$ 99.96, and its lowest recent point on October 04, 2018 at US$ 0.01. Arch Coal has 36 600 000 shares outstanding. |