A month has gone by since the last earnings report for Eversource Energy (ES). Shares have lost about 1.2% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Eversource due for a breakout? 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.
Eversource Energy Q3 Earnings and Revenues Beat Estimates
Eversource Energy reported third-quarter 2024 adjusted earnings of $1.13 per share, which surpassed the Zacks Consensus Estimate of $1.04 per share by 8.7%. The bottom line also increased 16.5% from the year-ago figure of 97 cents.
Revenues of $3.06 billion beat the Zacks Consensus Estimate of $3.05 billion by 0.4%. Total revenues also increased 9.6% from the year-ago figure of $2.79 billion.
Total operating expenses were $2.45 billion, up 8.4% year over year due to higher operations and maintenance expenses, and increased depreciation and amortization expenses.
Operating income totaled $612.4 million, up 15.4% year over year.
Interest expenses amounted to $300.6 million, 35.2% higher than the prior-year level.
Electric Transmission: Earnings totaled $174.9 million, up 9.1% year over year. This was due to a higher level of investment in Eversource’s electric transmission system.
Electric Distribution: Earnings amounted to $203.5 million, up 17.4% year over year. This was due to base distribution rate increases at NSTAR Electric and PSNH, and continued investments in its distribution system. The rise can also be attributed to lower storm-related operations and maintenance expenses.
Natural Gas Distribution: This segment reported a loss of $30.2 million, narrower than the year-ago loss of $33.7 million.
Water Distribution: Earnings amounted to $23.7 million, up 42.8% year over year. This was due to higher revenues from its water acquisition and lower depreciation expenses.
Eversource Parent & Other Companies: The segment reported earnings of $34 million, up 46.6% year over year. This was caused primarily by a lower effective tax rate.
Eversource Energy lowered its 2024 earnings guidance to $4.52-$4.60 per share from the previous projection of $4.50-$4.67. The Zacks Consensus Estimate is pegged at $4.56 per share, which is on par with the midpoint of the company’s new guided range.
ES expects its long-term EPS growth rate from existing core regulated businesses to be between 5% and 7% through 2028, using $4.34 per share (in 2023) as a base.
It has raised its guidance for capital investments to $23.7 billion from the previously predicted $23.1 billion for the 2024-2028 period. This is due to the recent approval of the Electric Sector Modernization Plan in Massachusetts.
It turns out, estimates review have trended downward during the past month.
At this time, Eversource 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.
Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. Notably, Eversource has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Eversource belongs to the Zacks Utility - Electric Power industry. Another stock from the same industry, Alliant Energy (LNT), has gained 6.4% over the past month. More than a month has passed since the company reported results for the quarter ended September 2024.
Alliant Energy reported revenues of $1.08 billion in the last reported quarter, representing a year-over-year change of +0.4%. EPS of $1.15 for the same period compares with $1.05 a year ago.
Alliant Energy is expected to post earnings of $0.68 per share for the current quarter, representing a year-over-year change of +41.7%. Over the last 30 days, the Zacks Consensus Estimate has changed -3.6%.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #4 (Sell) for Alliant Energy. Also, the stock has a VGM Score of C.
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