American Water (AWK) to Post Q3 Earnings: What's in Store?
American Water Works Company AWK is set to release third-quarter 2023 results on Nov 1, after market close. In the last four quarters, the company delivered an average earnings surprise of 7.07%.
Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.
Factors to Consider
American Water Works’ third-quarter earnings are expected to have benefited from new water rates, effective in different territories. It received approval for implementing new rates worth $340 million, effective Jan 1, 2023, which is likely to have had a positive impact on its third-quarter earnings.
AWK continues to expand operations through acquisitions. Those completed in the first nine months of 2023 are likely to have expanded operations and boosted demand and earnings in the quarter to be reported.
However, the increase in interest rates is a concern as the company plans to invest multi-billion dollars to strengthen and expand its infrastructure. The issue of new shares during the first half will have a dilutive impact on earnings.
Expectations
The Zacks Consensus Estimate for third-quarter earnings is pegged at 93 cents per share, indicating a year-over-year decline of 3.1% from the year-ago reported figure.
The Zacks Consensus Estimate for third-quarter revenues is pegged at $2.11 billion, indicating year-over-year growth of 5.6% from the year-ago reported figure.
What the Zacks Model Unveils
Our proven model does not conclusively predict an earnings beat for American Water Works this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here, as you will see below.
American Water Works Company, Inc. Price and EPS Surprise
American Water Works Company, Inc. price-eps-surprise | American Water Works Company, Inc. Quote
Earnings ESP: The company’s Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Zacks Rank: American Water Works currently has a Zacks Rank #3.
Stocks to Consider
Here are a few companies worth considering from the same sector that have the right combination of elements to beat on earnings in the upcoming releases.
Pinnacle West Capital Corp. PNW is set to release third-quarter 2023 results on Nov 2. PNW has an Earnings ESP of +0.15% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for 2023 earnings of PNW is $4.25 per share, indicating an increase of 1.7% in the last 60 days.
WEC Energy Group WEC is set to release third-quarter 2023 results on Oct 31. WEC has an Earnings ESP of +2.41% and a Zacks Rank #3.
The Zacks Consensus Estimate for 2023 earnings of WEC Energy is $4.61 per share, reflecting year-over-year growth of 3.6%.
Entergy ETR is set to release third-quarter 2023 results on Nov 1. ETR has an Earnings ESP of +0.36% and a Zacks Rank #3.
The Zacks Consensus Estimate for 2023 earnings of Entergy is $6.72 per share, indicating year-over-year growth of 4.67%.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
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Entergy Corporation (ETR) : Free Stock Analysis Report
WEC Energy Group, Inc. (WEC) : Free Stock Analysis Report
Pinnacle West Capital Corporation (PNW) : Free Stock Analysis Report
American Water Works Company, Inc. (AWK) : Free Stock Analysis Report
