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Utility Stocks Reporting Q3 Earnings on Nov 2: ED, DUK & More

The Zacks Utilities sector’s third-quarter 2023 earnings are expected to have been driven by warmer weather conditions, cost-saving initiatives and usage of new technologies that helped in increasing the reliability of its services and lowering operating and maintenance expenses.

Per the latest Earnings Preview, the Zacks Utilities sector’s third-quarter earnings are expected to increase 4.4%, while revenues are anticipated to decline 1.9% in the third quarter. The capital-intensive utility stocks might have been impacted by the ongoing rise in interest rates, while the new utility rates implemented in the service territories and customer growth are likely to have boosted profits.

Factors to Consider

Utilities continue to benefit from various favorable factors, such as new electric rates, customer additions, cost management and the implementation of energy-efficiency programs. Also, the ongoing investments to further improve the resiliency of electric infrastructure against extreme weather conditions and the transition to cost-effective, renewable energy sources to produce electricity might have aided the power industry.

By investing in digital technology, connecting critical systems, and using data analysis to make informed decisions, utilities have been able to increase overall operations and productivity while also lowering costs. Utilities keep making wise capital investments that lower fuel and operational costs as well as maintenance and upkeep costs. As a result, customers benefit from saving money on their utility costs.

Most of the utility companies have pledged to deliver 100% clean energy and achieve the zero-emission target in the coming years. As a result, these companies have been reducing their use of coal and other polluting sources in their generating portfolios and increasing the use of clean, renewable energy sources in their production portfolios.

Weather in the third quarter was warm, which adversely impacted use per customer during the period. An increase in interest rates from near-zero levels is likely to have had a negative impact on utilities’ performance.

According to the Zacks model, a company needs the right combination of two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better — to increase the odds of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Consolidated Edison’s ED service territories experienced a warmer-than-normal weather pattern during the most of the third quarter. This is expected to have boosted electricity demand, thereby favorably contributing to its third-quarter top-line performance. The increased load growth driven by vehicle electrification is likely to have benefited ED’s earnings in the to-be-reported quarter. (Read more: Consolidated Edison to Post Q3 Earnings: What's in Store?)

Our proven model conclusively predicts an earnings beat for Consolidated Edison this time around. ED has an Earnings ESP of +3.93% and a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Consolidated Edison Inc Price and EPS Surprise

Consolidated Edison Inc Price and EPS Surprise
Consolidated Edison Inc Price and EPS Surprise

Consolidated Edison Inc price-eps-surprise | Consolidated Edison Inc Quote

Duke Energy Corporation’s DUK service territories experienced warmer-than-normal temperatures, which can be projected to have boosted electricity demand. This, in turn, must have bolstered the company’s quarterly top-line performance. Favorable rate hikes and strong customer growth might have positively contributed to Duke Energy’s third-quarter revenues. (Read more: Duke Energy to Post Q3 Earnings: What's in Store?)

Our proven model does not conclusively predict an earnings beat for Duke Energy this time around. DUK has an Earnings ESP of 0.00% and a Zacks Rank #3 at present.

Duke Energy Corporation Price and EPS Surprise

Duke Energy Corporation Price and EPS Surprise
Duke Energy Corporation Price and EPS Surprise

Duke Energy Corporation price-eps-surprise | Duke Energy Corporation Quote

Exelon Corporation’s EXC third-quarter earnings are likely to have benefited from new distribution rates that were implemented during the previous quarters. The company’s bottom line is also likely to have gained from energy efficiency programs and cost-saving initiatives. (Read more: Exelon to Report Q3 Earnings: Here's What to Expect)

Our proven model does not conclusively predict an earnings beat for Exelon this time around. EXC has an Earnings ESP of -2.45% and a Zacks Rank #3 at present.

Exelon Corporation Price and EPS Surprise

Exelon Corporation Price and EPS Surprise
Exelon Corporation Price and EPS Surprise

Exelon Corporation price-eps-surprise | Exelon Corporation Quote

Pinnacle West Capital Corporation’s PNW third-quarter revenues are expected to have benefited from increased retail customer count and electricity sales growth, owing to strong growth in Arizona. However, higher operations and maintenance expenses and interest expenses might offset some positives. (Read more: What's in Store for Pinnacle West Capital in Q3 Earnings?)

Our proven model does not conclusively predict an earnings beat for Pinnacle West Capital this time around. PNW has an Earnings ESP of -0.80% and a Zacks Rank #3 at present.

Pinnacle West Capital Corporation Price and EPS Surprise

Pinnacle West Capital Corporation Price and EPS Surprise
Pinnacle West Capital Corporation Price and EPS Surprise

Pinnacle West Capital Corporation price-eps-surprise | Pinnacle West Capital Corporation Quote

Alliant Energy’s LNT service territories experienced a warmer-than-normal weather pattern, accompanied by drought-like conditions. This is expected to have boosted electricity demand in the third quarter. The company’s quarterly earnings are also likely to have gained from lower operation and maintenance costs. (Read more: Alliant Energy to Report Q3 Earnings: What's in Store?)

Our proven model does not conclusively predict an earnings beat for Alliant Energy this time around. The company has an Earnings ESP of -0.55% and a Zacks Rank #4 (Sell) at present.

Alliant Energy Corporation Price and EPS Surprise

Alliant Energy Corporation Price and EPS Surprise
Alliant Energy Corporation Price and EPS Surprise

Alliant Energy Corporation price-eps-surprise | Alliant Energy Corporation Quote

NRG Energy’s NRG service territories experienced extreme heat during the third quarter, which is expected to have increased the demand for electricity (for cooling purposes) and boosted the company’s performance. NRG’s debt reduction initiatives might have aided its bottom-line performance. (Read more: NRG Energy to Post Q3 Earnings: What’s in the Offing?)

Our proven model does not conclusively predict an earnings beat for NRG Energy this time around. The company has an Earnings ESP of -7.19% and a Zacks Rank #3 at present.

NRG Energy, Inc. Price and EPS Surprise

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

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

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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Exelon Corporation (EXC) : Free Stock Analysis Report

NRG Energy, Inc. (NRG) : Free Stock Analysis Report

Duke Energy Corporation (DUK) : Free Stock Analysis Report

Consolidated Edison Inc (ED) : Free Stock Analysis Report

Pinnacle West Capital Corporation (PNW) : Free Stock Analysis Report

Alliant Energy Corporation (LNT) : Free Stock Analysis Report

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