Foresight Energy (FELP) and Its Competitors Critical Analysis

Foresight Energy (NYSE: FELP) is one of 32 publicly-traded companies in the “Coal” industry, but how does it contrast to its competitors? We will compare Foresight Energy to similar companies based on the strength of its dividends, institutional ownership, analyst recommendations, profitability, earnings, valuation and risk.

Earnings and Valuation

This table compares Foresight Energy and its competitors revenue, earnings per share and valuation.

Gross Revenue NetIncome Price/Earnings Ratio
Foresight Energy $875.83 million -$178.78 million -2.49
Foresight Energy Competitors $934.53 million -$31.41 million 14.05

Foresight Energy’s competitors have higher revenue and earnings than Foresight Energy. Foresight Energy is trading at a lower price-to-earnings ratio than its competitors, indicating that it is currently more affordable than other companies in its industry.

Analyst Recommendations

This is a summary of current ratings and recommmendations for Foresight Energy and its competitors, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Foresight Energy 0 3 0 0 2.00
Foresight Energy Competitors 188 634 1013 18 2.46

Foresight Energy currently has a consensus price target of $5.25, indicating a potential upside of 25.00%. As a group, “Coal” companies have a potential upside of 24.48%. Given Foresight Energy’s higher probable upside, analysts plainly believe Foresight Energy is more favorable than its competitors.

Dividends

Foresight Energy pays an annual dividend of $0.26 per share and has a dividend yield of 6.2%. Foresight Energy pays out -15.4% of its earnings in the form of a dividend. As a group, “Coal” companies pay a dividend yield of 8.4% and pay out 77.5% of their earnings in the form of a dividend.

Volatility & Risk

Foresight Energy has a beta of 0.81, indicating that its stock price is 19% less volatile than the S&P 500. Comparatively, Foresight Energy’s competitors have a beta of 0.90, indicating that their average stock price is 10% less volatile than the S&P 500.

Profitability

This table compares Foresight Energy and its competitors’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Foresight Energy -19.93% -9.94% -2.43%
Foresight Energy Competitors -212.70% 5.87% 2.17%

Institutional and Insider Ownership

11.7% of Foresight Energy shares are held by institutional investors. Comparatively, 44.4% of shares of all “Coal” companies are held by institutional investors. 21.2% of shares of all “Coal” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.

Summary

Foresight Energy competitors beat Foresight Energy on 11 of the 14 factors compared.

About Foresight Energy

Foresight Energy LP is engaged in the mining and marketing of coal from reserves and operations located in the Illinois Basin. As of December 31, 2016, the Company controlled 2.1 billion tons of coal in the state of Illinois. Its reserves consist principally of three contiguous blocks of uniform, thick, high heat content (high Btu) thermal coal, which are used for longwall operations. The Company operates four underground mining complexes in the Illinois Basin, including Williamson, Sugar Camp, Hillsboro and Macoupin. Its mining complexes operate in the Illinois Basin with approximately two located in Southern Illinois and over two located in Central Illinois. Williamson, Sugar Camp and Hillsboro are longwall operations, and Macoupin is a continuous miner operation. The Company markets and sells its coal to electric utility and industrial companies in the eastern half of the United States as well as internationally (primarily into Europe).

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