It has been about a month since the last earnings report for Clearway Energy (CWEN). Shares have added about 4% in that time frame, underperforming 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 the most recent earnings report in order to get a better handle on the important catalysts.

Clearway Energy Q3 Earnings Lag Estimates, Revenues Surpass

Clearway Energy Inc. recorded third-quarter 2024 earnings of 31 cents per share, which missed the Zacks Consensus Estimate of 48 cents by 35.4%. However, the bottom line increased 933% from 3 cents in the year-ago quarter.

Revenues

Total revenues of $486 million surpassed the Zacks Consensus Estimate of $442 million by 9.8%. The top line also increased 31% from the year-ago figure of $371 million.

Highlights of the Release

Adjusted EBITDA for the quarter totaled $354 million compared with $323 million in the year-ago period.

The company signed an agreement with Clearway Group to commit to invest in a 500 megawatt (MW) solar plus storage project. CWEN received offer from Clearway Group to invest in a 320-MW storage hybridization project.

Total operating costs and expenses for the quarter were $308 million, up 11.2% from the year-ago figure of $277 million.
This was due to higher depreciation, amortization and accretion costs.

The operating income for the quarter came in at $178 million compared with the year-ago figure of $94 million.

CWEN incurred interest expenses of $139 million compared with $48 million in the year-ago quarter.

Financial Position

Clearway Energy had cash and cash equivalents of $292 million as of Sept. 30, 2024, compared with $535 million as of Dec. 31, 2023.

Total liquidity as of Sept. 30, 2024, was $1.27 billion compared with $1.5 billion recorded as of Dec. 31, 2023.

Long-term debt as of Sept. 30, 2024, amounted to $6.73 billion compared with $7.48 billion as of Dec. 31, 2023.

Net cash provided by operating activities in the first nine months of 2024 totaled $578 million compared with $496 million in the year-ago period.

Guidance

The company continues to expect 2024 net income and adjusted EBITDA of $90 million and $1.18 billion, respectively.

Cash from Operating Activities is expected to be $830 million for the same period.

Clearway Energy reaffirmed its guidance for 2024 cash available for distribution (CAFD) at $395 million.

The company initiated a full-year 2025 CAFD guidance of $400-$440 million. It expects adjusted EBITDA to be in the range of $1.195-$1.235 billion. Cash from Operating Activities is expected to be in the band of $844-$884 million.

 

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in fresh estimates.

The consensus estimate has shifted 288% due to these changes.

VGM Scores

Currently, Clearway Energy has a nice Growth Score of B, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Clearway Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

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