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What's in the Cards for DTE Energy (DTE) in Q3 Earnings?

DTE Energy Company DTE is slated to report third-quarter 2023 results on Nov 1, before the opening bell.

In the last reported quarter, the company delivered an earnings surprise of 11.24%. DTE has a trailing four-quarter average earnings surprise of 4.07%.

Factors to Note

In the third quarter, DTE Energy’s service territories witnessed an unfavorable temperature pattern. In particular, while the temperature remained moderate in the month of July, a below-normal temperature prevailed in the last two months of the July-September quarter.

Such a colder-than-normal temperature pattern can be expected to have led to reduced electricity demand from DTE Energy’s customers during the summer months, thereby adversely impacting the company’s third-quarter top-line performance.

DTE Energy Company Price and EPS Surprise

DTE Energy Company Price and EPS Surprise
DTE Energy Company Price and EPS Surprise

DTE Energy Company price-eps-surprise | DTE Energy Company Quote

Moreover, DTE is likely to have witnessed lower residential sales from the 2022 level with the return of people to work, higher rate base cost and accelerated deferred tax amortization in 2022, which, in turn, might have hurt its revenues. However, the company’s grid strengthening efforts can be projected to have favorably contributed to its quarterly top-line performance.

The Zacks Consensus Estimate for revenues is pegged at $3.96 billion, indicating a deterioration of 24.6% year over year.

From the cost perspective, higher rate-based cost is likely to have adversely impacted the company’s bottom line in the to-be-reported quarter. Nevertheless, higher earnings from its renewable plants, along with DTE’s cost reduction efforts, are expected to have boosted its overall bottom-line performance.

The Zacks Consensus Estimate for third-quarter earnings is pegged at $1.72 per share, implying an improvement of 7.5% from the prior-year period’s reported number.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for DTE Energy this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is not the case here.

Earnings ESP: The company’s Earnings ESP is -4.58%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: DTE currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Stocks to Consider

Here are three Utility players that you may want to consider as these have the right combination of elements to come up with an earnings beat this reporting cycle.

Consolidated Edison ED has an Earnings ESP of +3.93% and a Zacks Rank #2 at present. The company delivered a four-quarter average earnings surprise of 8.22%.

Consolidated Edison boasts a long-term earnings growth rate of 2%. The Zacks Consensus Estimate for ED’s third-quarter earnings and sales is pegged at $1.58 per share and $3.82 billion, respectively.

NiSource NI has an Earnings ESP of +18.52% and a Zacks Rank #2 at present. The Zacks Consensus Estimate for third-quarter earnings is pegged at 14 cents per share, implying a 40% increase from that reported in the prior-year quarter.

The consensus mark for NI’s sales is pinned at $1.06 billion. The company has a trailing four-quarter average negative earnings surprise of 5.61%.

Ameren AEE has an Earnings ESP of +0.22% and a Zacks Rank #3 at present. The consensus estimate for third-quarter earnings is pinned at $1.80 per share, indicating a 3.5% increase year over year.

Ameren boasts a four-quarter average earnings surprise of 8.86%. The consensus mark for third-quarter sales is pegged at $2.37 billion, indicating growth of 2.9% from that recorded in the prior-year quarter.

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

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Ameren Corporation (AEE) : Free Stock Analysis Report

NiSource, Inc (NI) : Free Stock Analysis Report

DTE Energy Company (DTE) : Free Stock Analysis Report

Consolidated Edison Inc (ED) : Free Stock Analysis Report

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