Why Is Clearway Energy (CWEN) Up 13.6% Since Last Earnings Report?
A month has gone by since the last earnings report for Clearway Energy (CWEN). Shares have added about 13.6% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Clearway Energy due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Clearway Energy Q4 Earnings Lag Estimates, Sales Rise
Clearway Energy Inc. recorded a fourth-quarter 2021 operating loss of 7 cents per share, which missed the Zacks Consensus Estimate for earnings of 17 cents by 141.2%. The bottom line declined 164% from the year-ago figure’s tally of 11 cents.
Clearway Energy reported 2021 earnings per share (EPS) of 44 cents, which lagged the Zacks Consensus Estimate of 68 cents by 35.3%. However, the bottom line increased 100% from the year-ago figure of 22 cents.
Revenues
Operating revenues of $318 million surpassed the Zacks Consensus Estimate of $291 million by 9.3%. The top line also improved 13.6% from $280 million in the prior-year quarter.
Clearway Energy’s total revenues for 2021 were $1,286 million, which surpassed the Zacks Consensus Estimate of $1,280 million by 0.5%. Total revenues improved 7.3% from the year-ago figure of $1,199 million.
Highlights of the Release
Total operating expenses for 2021 amounted to $1,019 million, up 17.7%from the year-ago figure of $866 million, due to an increase in operation and development costs.
Operating income was $267 million, down 20% year over year.
In 2021, CWEN reported interest expenses of $312 million, down 24.8% year over year.
Financial Position
Clearway Energy had cash and cash equivalents of $178 million as of Dec 31, 2021, down from $268 million on Dec 31, 2020.
Total liquidity as of Dec 31, 2021 was $821 million, down 8.2% from the Dec 31, 2020 level of $894 million.
Long-term debt as of Dec 31, 2021 was $6,939 million compared with $6,585 million on Dec 31, 2020.
Clearway Energy’s net cash provided from operating activities for 2021 was $701 million compared with $545 million in the year-ago period.
Guidance
Clearway Energy reiterated 2022 cash available for the distribution guidance of $395 million.
The sale of CWEN’s Thermal Business is on track to get closed in the first half of 2022 for an estimated value of $1.9 billion. With $1.35 billion in net proceeds, which will provide financial flexibility to complete new projects and boost the renewable portfolio.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
The consensus estimate has shifted -68.52% due to these changes.
VGM Scores
Currently, Clearway Energy has a subpar Growth Score of D, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Clearway Energy has a Zacks Rank #5 (Strong Sell). We expect a below average return from the stock in the next few months.
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