Peabody Energy Corporation (BTU)

[eFinanceMarkets]

Peabody Energy too cheap after two-week slide, J.P. Morgan analyst says

Peabody Energy (BTU +2.6%) has lost nearly a quarter of its market cap since it emerged from bankruptcy and started trading on April 4, but J.P. Morgan analyst John Bridges contends that the stock's weakness looks overdone.

Bridges believes coal must remain a key part of the U.S. energy mix for reliability reasons, agrees with BTU's optimism for growth in thermal coal sales into southeast Asia, and says "published gas costs may not be telling the whole economic story."

Also, FBR analysts raise their BTU stock price target to $34, seeing the failure of the Metropolitan Coal sale as "slightly positive" for valuation given the current strength in met coal prices.