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CenterPoint Energy (CNP) to Post Q2 Earnings: What's in Store?

Zacks Equity Research

CenterPoint Energy, Inc. CNP is set to report second-quarter 2019 results on Aug 7, before the opening bell.

In the last reported quarter, the company witnessed a negative earnings surprise of 8%. The bottom line also missed the Zacks Consensus Estimate in three of the trailing four quarters, the average miss being 4.78%.

Let’s see how things are shaping up prior to this announcement.

Factors Under Consideration

CenterPoint Energy's major service territories experienced above-average temperature along with heavy rainfall in the secondquarter. This is likely to boost demand for electricity, which.in turn, should boost the company’s top-line performance.

For second-quarter revenues, the Zacks Consensus Estimate stands at $2.83 billion, suggesting a 29.5% improvement from the year-ago quarter’s reported figure.

Moreover, the company expects a final order from the Public Utilities Commission of Ohio in the second quarter regarding a settlement agreement, which reflects a $23 million increase in annual revenues. We may expect further details on this matter, once the company releases its quarterly results.

CenterPoint Energy, Inc. Price and EPS Surprise

CenterPoint Energy, Inc. Price and EPS Surprise

CenterPoint Energy, Inc. price-eps-surprise | CenterPoint Energy, Inc. Quote

The aforementioned revenue growth prospect is likely to bolster CenterPoint Energy’s second-quarter earnings. However, its service territories experienced some storms and tornados, which tend to cause damage and thereby disrupt the smooth supply of power by CenterPoint. This, in turn, might mar the company’s bottom line in the soon-to-be-reported quarter.

The Zacks Consensus Estimate for quarterly earnings is pinned at 31 cents, implying a 3.3% improvement from the prior-year quarter’s reported number.

Earnings Whispers

Our proven model does not show an earnings beat for CenterPoint Energy in second-quarter 2019. That is because a stock needs to have both — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — for this to happen. That is not the case here as you will see below. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: CenterPoint Energy has an Earnings ESP of -3.74%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3, which along with a negative Earnings ESP makes surprise prediction difficult.

Note that we caution against stocks with a Zacks Rank #4 or 5 (Sell-rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Upcoming Utility Releases

Here are a few players from the Utilities sector that have the right combination of elements to beat on earnings beatin the upcoming releases.

PPL Corporation PPL has an Earnings ESP of +1.18% and a Zacks Rank of 3. The company is expected to release second-quarter 2019 results on Aug 6.

Northwest Natural Gas Company NWN is scheduled to release second-quarter 2019 results on Aug 6. It has an Earnings ESP of +29.41% and a Zacks Rank #3.

NewJersey Resources Corporation NJR is scheduled to release third-quarter fiscal 2019 results on Aug 6. It has an Earnings ESP of +9.80% and a Zacks Rank #3.

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