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Xcel Energy's (XEL) Earnings Miss Estimates in Q3, Up Y/Y

Zacks Equity Research

Xcel Energy Inc. XEL posted third-quarter 2019 operating earnings of $1.01 per share, which lagged the Zacks Consensus Estimate of $1.05 by 3.8%. The bottom line increased 5.2% from the year-ago quarter’s levels.

The year over year uptick in earnings was driven by higher electric margins courtesy of non-fuel riders, regulatory rate outcomes as well as lower O&M expenses. However, these factors were offset by increased depreciation and interest expenses as well as lower allowance for funds used during construction.

Total Revenues

Xcel Energy’s third-quarter revenues amounted to $3,013 million, which missed the Zacks Consensus Estimate of $3,221 million by 6.5%. The figure also declined 1.1% from the prior-year quarter’s tally of $3,048 million. Lower Electric and Natural gas revenues hurt the quarterly top line outcome.

Xcel Energy Inc. Price, Consensus and EPS Surprise

 

Xcel Energy Inc. Price, Consensus and EPS Surprise

Xcel Energy Inc. price-consensus-eps-surprise-chart | Xcel Energy Inc. Quote

 

Segment Results

Electric: Revenues declined 1.1% to $2,771 million from $2,802 million in the last reported quarter.

Natural Gas: Revenues declined 2.2% to $222 million from the year-ago quarter’s tally.

Other: Revenues in the segment amounted to $20 million in the quarter, up 5.3% from the year-ago quarter’s figure.

Quarterly Highlights

Total operating expenses fell 4.1% year over year to $2,255 million.

Operating income in the reported quarter improved 8.9% from the prior-year quarter’s tally to $758 million.

Total interest charges and financing costs in the reported quarter rose 17.1% from the prior-year quarter’s figure to $192 million.

Outlook

Xcel Energy narrowed its 2019 earnings per share (EPS) guidance in the range of $2.60-$2.65 from its previous expectation of $2.55 -$2.65. The midpoint of the current guidance is $2.62, which is higher than the Zacks Consensus Estimate of $2.61.

The company reaffirmed long-term earnings growth in the range of 5-7% from a base of $2.60 (mid-point of the original 2019 guidance range) per share. Xcel Energy projects an annual increase in dividend rate by 5-7%.

The company provided 2020 EPS guidance in the range of $2.73-$2.83. The midpoint of this range is $2.78 which is lower than the Zacks Consensus Estimate of $2.79.

Zacks Rank

Xcel Energy carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Utility Releases

NextEra Energy, Inc NEE reported third-quarter 2019 adjusted earnings of $2.39 per share, which beat the Zacks Consensus Estimate of $2.27 by 5.3%.

American Electric Power Co., Inc. AEP reported third-quarter 2019 adjusted earnings per share (EPS) of $1.46, which surpassed the Zacks Consensus Estimate of $1.30 by 12.3%.

CMS Energy Corporation CMS reported third-quarter 2019 EPS of 73 cents, up 23.7% from the year-ago quarter’s reported figure of 59 cents.

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