Peabody Energy (NYSE:BTU) Led by Solid U.S. Performance

Concerns surrounded Peabody Energy (NYSE:BTU) recently over what type of earnings report they'd have in light of Australian operations, but the U.S. market helped them exceed expectations, and Australia performed better than expected.

Barclays says, "The beat was driven in part by strong U.S. performance coupled with higher than expected revenues at the company's Australian operations. The quarter also benefitted from a lower-than-expected tax rate because of lower contributions from Australia, which has a higher effective tax rate than the company's other operations. Strong results were partially offset by higher-than-expected Australian costs and weaker than expected performance from the company's trading and brokerage division."

Barclays maintains an "Overweight" rating on Peabody Energy (BTU), which closed Thursday at $62.38, down $0.76, or 1.20 percent. Barclays boosted their price target on Peabody from $70 to $75.

Peabody Energy (NYSE:BTU) Shares Ready to Rebound, Aussie Floods Priced in

Peabody Energy (NYSE:BTU) appears at a good entry point, says FBR, citing the impact of the Australian floods on the shares are already priced in.

FBR says, "We head into the highly volatile year-end earnings season (BTU tomorrow) in a better position than normal, given recent 4Q10 preannouncements from Arch Coal (NYSE: ACI), Alpha Natural (NYSE: ANR), BTU, Cloud Peak (NYSE: CLD), CONSOL (NYSE: CNX), Massey (NYSE: MEE), and Natural Resource Partners (NYSE: NRP). Also, MSHA 4Q10 mine production data have started to come out negatively for several companies, but not so for Peabody Energy's U.S. operations....

"The sector has declined off the top and is poised to react less to negative news and, hopefully, more favorably to positive news. BTU has lagged its U.S. and Australian peers by about 10%–15% for the one-, three-, and six-month periods, in part from 4Q10's and 1Q11's Australian flood impact and acquisition worries. We believe shares already discount the news and are now a bargain in front of several expected catalysts: (1) Australian production recovery, (2) West Coast port announcement, (3) formal sanctioning of Australia Millennium mine, (4) trading group upside with rising price volatility ($5/share value), (5) Mongolia optionality, (6) China project values becoming better understood, (7) acquisition risk overstated, with an outstanding track record.

"While 2011 estimates may initially be reset due to 1Q11's Australian supply issues, we believe estimates will be walked up over the rest of the year from rising prices, faster supply recovery, trading activity, and use of free cash flow."

FBR Capital maintains an "Outperform" rating on Peabody Energy (BTU), which was trading at $59.01, up $0.84, or 1.44 percent, as of 1:09 PM EST. FBR has a price target of $77 on Peabody.