As any sports fan will tell you, you can't have the thrill of victory without the agony of defeat. Given the palpable sense of frustration and nervousness surrounding the equity markets just now, the achievement of one talented athlete is again the envy of fellow competitors.

After trimming a little excess from its waistline in preparation for a long and grueling contest, the world's largest coal miner -- Peabody Energy (NYSE:BTU) -- has set a record pace in the early going of an epic race. First to report earnings among the coal miners, Peabody blew away analyst estimates by nearly 50%. Its fourth-quarter earnings were 719% better than a year earlier. That's no misprint, and it still pales in comparison to the third quarter, in which Peabody improved year-over-year earnings by more than 1,000%!

Despite a solid surge after the release, Peabody's shares continue to exchange at a reasonable multiple of just around eight times those trailing 2008 earnings of $3.51 per share. Given the company's strategic position with a foot in China's door, a sizable footprint in Australia, and a massive presence within the Powder River Basin in the western U.S., Peabody Energy remains this Fool's top pick among coal miners to benefit from fiscally stimulated demand resumption in China and the United States.

Steel demand worldwide continues to melt within a furnace of global contraction, highlighted by the swift departure of POSCO's (NYSE:PKX) CEO after the company missed earnings estimates by 30% recently. As the export market for met coal vanished during the second half of 2008, eastern U.S. miners such as Massey Energy (NYSE:MEE) and Peabody spin-off Patriot Coal (NYSE:PCX) were among the hardest hit. Patriot shares have plunged more than 90% from their midsummer peak, as the company has closed several mines and slashed its workforce in response to the weak environment.

Peabody, in contrast, opted for more modest production cuts. It reported that essentially all of the company's anticipated domestic production for 2009 has already been sold forward through purchase agreements. This is music to the ears of major Powder River Basin coal haulers such as Burlington Northern Santa Fe (NYSE:BNI) and Union Pacific (NYSE:UNP), which are facing calamitous declines in overall freight volumes. Announcing plans to acquire half of a massive joint venture in Mongolia, Peabody continues to run, even as the rest of the coal industry crawls through this weakness.

Further Foolishness:

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Fool contributor Christopher Barker wishes he could squeeze coal into diamonds. He can be found blogging actively and acting Foolishly within the CAPS community under the username TMFSinchiruna. He owns shares of Massey Energy and Peabody Energy. The Motley Fool's disclosure policy has a scrubber in its smokestack.