Alliance Resource Partners: How Did It Miss 1Q16 Estimates?
Earnings announcement
Alliance Resource Partners (ARLP) announced its 1Q16 earnings results for the quarter ended March 31, 2016, before market hours on April 26, 2016. In this series, we’ll analyze the 1Q16 results of Alliance Resource Partners in detail, compare the results with analyst expectations, and analyze the factors that caused deviation. Also, we’ll have a look at the management’s guidance, analyst expectations for 2016, and the outlook for the company.
Alliance Resource Partners’ stock reaction
Alliance Resource Partners posted muted earnings for the quarter ended March 31, 2016. The company reported adjusted EPS (earnings per share) of $0.37 against analysts’ consensus EPS estimate of $0.44. ARLP’s stock price was up by nearly 3% during the intraday trading session on April 26, 2016. Alliance Resource Partners’ strong operational 1Q16 performance reaffirmed fiscal 2016 guidance on the backdrop of challenging market conditions. This helped the stock to close on a positive note.
Peer performance
The recent rally in commodity prices helped stocks of major coal mining companies ARLP, Cloud Peak Energy (CLD), Alpha Natural Resources (ANRZQ), Arch Coal (ACIIQ), and Westmoreland Coal Company (WLB) recover from their February lows. However, Peabody Energy (BTUUQ) is an exception. Peabody Energy’s stock has tumbled more than 80% so far in fiscal 2016. The company filed for chapter 11 bankruptcy protection on April 13, 2016.
On the day of ARLP’s earnings release, Peabody Energy and Cloud Peak Energy were up by nearly 2% and 9%, respectively. Westmoreland Coal Company’s stock closed nearly flat during the intraday trading session.
The Market Vectors Coal ETF (KOL) rose by nearly 1.3% before closing and the SPDR S&P 500 ETF (SPY) closed nearly unchanged. Next, we’ll look at Alliance Resource Partners’ coal shipments for 1Q16.
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