• In early January 2026, an industry report indicated that Powder River Basin coal supply has tightened as several coal-fired power units are being retired later than previously planned, leaving producers like Peabody Energy with much of their expected 2026 output already under contract.
• This development highlights how Peabody’s focus on securing long-term coal supply agreements may support revenue visibility even as decarbonization pressures continue.
• We’ll now examine how tighter Powder River Basin supply and higher contracted volumes influence Peabody Energy’s existing investment narrative.

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Peabody Energy Investment Narrative Recap

To own Peabody Energy today, you need to believe coal can remain cash generative long enough for the company to keep translating contracted volumes into earnings, even as decarbonization pressures build. The recent tightening in Powder River Basin supply, with much of 2026 output already sold forward, appears supportive of near term revenue visibility rather than changing the key risk, which remains long term demand erosion and regulatory pressure on coal.

Against this backdrop, Peabody’s pattern of using free cash flow to reduce debt and return capital, while avoiding aggressive volume growth, is particularly relevant. The company’s decision in late 2025 to continue paying a regular US$0.075 quarterly dividend, despite a swing to quarterly net losses, underlines how management is emphasizing balance sheet strength and disciplined capital returns as central to the current investment case and its near term catalysts.

Peabody Energy's narrative projects $4.9 billion revenue and $468.2 million earnings by 2028. This requires 6.4% yearly revenue growth and a roughly $327.3 million earnings increase from $140.9 million today.

Uncover how Peabody Energy's forecasts yield a $34.80 fair value, a 3% upside to its current price.

Exploring Other Perspectives

Five members of the Simply Wall St Community value Peabody between about US$28 and US$86 per share, highlighting very different expectations. You can weigh these against the risk that long term renewable energy adoption and net zero policies could shrink Peabody’s addressable coal market and pressure future revenues.