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SunCoke Energy: Don't Get Too Excited By The Higher Guidance

Aug. 05, 2021 2:41 PM ETSunCoke Energy, Inc. (SXC)8 Comments
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  • After seeing a strong first half of 2021, SunCoke Energy has materially increased their earnings guidance.
  • Whilst this sounds positive, they have not materially increased their free cash flow guidance.
  • This stems from higher capital expenditure due to inflationary pressure and thus mitigates the appeal or benefit of their higher accrual-based earnings guidance.
  • This also poses future concerns of further inflation eroding their cash flow generation to a more significant extent.
  • Whilst this is not ideal, I still believe that my bullish rating is appropriate due to their forecast double-digit free cash flow yield.

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When reporting season rolls around every quarter, it can be quite nerve-racking for investors as they wait to see how their companies have performed with any disappointments often sending share prices plunging. Thankfully for the shareholders

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I am no longer active, as I am taking a hiatus from finance to pursue business ventures in other sectors.  I hope that my analysis was helpful to investors across the years, thank you.

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