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NextEra (NEE) to Report Q4 Earnings: What's in the Offing?

Zacks Equity Research

NextEra Energy, Inc. NEE is scheduled to release fourth-quarter 2019 earnings on Jan 24, 2020, before the market opens. This utility delivered a positive earnings surprise of 5.3% in the last reported quarter.

Notably, the company delivered average positive earnings surprise of 4.2% in the last four quarters.

Factors to Consider

NextEra’s fourth-quarter earnings are likely to have been negatively impacted by financing breakage impacts associated with several wind repowerings and Energy Resources’ share of costs associated with the acquisition of the outstanding Genesis debt. These factors are likely to adversely impact earnings in the to-be-reported quarter by 10-15 cents. The conversion of corporate units into equity shares in second-half 2019 resulted in increase in the company’s shares outstanding. This is likely to have diluted its bottom line.

NextEra Energy’s fourth-quarter earnings are expected to have benefited from ongoing customer addition at Florida Power & Light Company, and contribution from Gulf Power Company.

The Zacks Consensus Estimate for fourth-quarter earnings and revenues is pegged at $1.54 per share and $4.9 billion, respectively. The projected revenues and earnings per share indicate a year-over-year improvement of 6.8% and 3.4%, respectively, from the year-ago reported figures.

What Our Quantitative Model Predicts

Our proven model does not conclusively predict an earnings beat for NextEra this time around. A stock needs to have both a positive Earnings ESP (which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate) and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to surpass estimates. That is not the case here as you will see below.

NextEra Energy, Inc. Price and EPS Surprise

NextEra Energy, Inc. Price and EPS Surprise
NextEra Energy, Inc. Price and EPS Surprise

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

Earnings ESP: The company’s Earnings ESP is -6.94%.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, NextEra carries a Zacks Rank #4 (Sell).

Stocks to Consider

Investors can consider the following players from the same industry that have the right combination of elements to post an earnings beat in the to-be-reported quarter.

Dominion Energy D is slated to release fourth-quarter 2019 results on Feb 11, 2020. It has an Earnings ESP of +0.72% and a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Ameren Corporation AEE is set to release fourth-quarter 2019 numbers on Feb 13. It has an Earnings ESP of +6.67% and carries a Zacks Rank #3.

The Southern Company SO is scheduled to release fourth-quarter 2019 results on Feb 19. It has an Earnings ESP of +0.75% and a Zacks Rank #3.

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