I would say the changes are already over factored in. Meanwhile, Obama is on vacation thank God and life moves on. It's going to be hot and muggy in the mid west and electric utilities will operating near peak burning cheap coal for air conditioning load. Why worry? It's only politics as usual and it will take 10 years to full implement the new EPA rules.
Nothing will change the second quarter numbers...that's history, and the coal stock have been commensurately punished for their loses.
But a "perceived" stabilization of pricing, pockets of pricing strength in future contracts, the effects of drastic curtailments in capital spending hitting the bottom line, depletion of existing inventories, a normal hot summer, the fear of another cold winter, the realization that Obama is lame duck, the realization that the EPA's power is limited, the possibility that political representative from coal States will grow a set of balls, can all help lead to the impression that future profitability is forthcoming...then perhaps "the market" will start buying coal stocks rather than liquidating them.
Excellent comments dstone ... In addition I think possible bankruptcies among BTU competitors may further enhance Peabody's competitive position in the near future. With excellent management, BTU is best of breed in a very beaten up sector.