5 of 7 major US coal companies beat EPS estimates in Q4'21

Five of the seven publicly traded, U.S-based coal companies analyzed by S&P Global Market Intelligence beat S&P Capital IQ consensus normalized EPS estimates for the fourth quarter of 2021.

Analysts forecast higher year-over-year earnings for coal miners in the year's final quarter on the back of higher prices and an increase in sales driven by rising coal demand linked to higher natural gas prices.

Russia's invasion of Ukraine recently triggered an increase in prices for commodities, including coal. Credit Suisse said Feb. 22 that the global coal supply was already tight before the conflict escalated. Russia is a major coal exporter, and some European nations have looked for alternative sources, while the U.S. banned coal imports from Moscow.

Peabody Energy Corp. led companies included in the analysis after exceeding estimates by 107.2%. The St. Louis-based miner booked a normalized EPS of $3.46 compared to the forecast of $1.67.

Warrior Met Coal Inc. beat the forecast by 22.9%, while Alpha Metallurgical Resources Inc. exceeded the estimate by 17.6%. Arch Resources Inc. and Consol Energy Inc. beat estimates by 2.7% and 2.4%, respectively.

Ramaco Resources Inc. was the only company that matched analyst estimates, posting a normalized EPS of 42 cents. Alliance Resource Partners LP's normalized EPS of 40 cents missed analyst forecasts by 42%.

Further analysis of Market Intelligence data showed that the gap between the price performances of Peabody and Alliance Resource Partners narrowed through the end of December 2021 after Peabody dominated Alliance Resource Partners for most of the year.

Peabody outperformed the S&P 500 Oil, Gas and Consumable Fuels Index for most of 2021, while Alliance Resource Partners and other coal companies were mostly in line with the index before beating it during the second half of 2021.

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