Shares of coal company Walter Energy, Inc. (WLT) fell more than 20% last week on a report that it would postpone its debt refinancing plans. However, Tudor Pickering analysts see this sell-off as an overreaction.
The analysts note that though WLT did indeed postpone refi plans, it has no material debt principal payments due until 2015. As such, the sell-off has been emotions getting the better of investors. Its shares should rebound as “fear adjusts to reality.”
The analysts rate WLT as “Accumulate” with a price target of $31. This target suggests a 156% upside to Friday’s closing price of $12.13.
Walter Energy share were up 56 cents, or +4.63%, during morning trading on Monday. The stock is down -64.07% year-to-date.
The Bottom Line
Shares of Walter Energy (WLT) have a dividend yield of 4.12% based on Friday’s closing price of $12.13 and the company’s annualized dividend payout of 50 cents per share.