), a public utility holding company, is scheduled to report its
third-quarter 2012 financial results on October 29, 2012.
Northeast's second-quarter 2012 pro-forma earnings per share were
45 cents, which is in line with the Zacks Consensus Estimate, but
surpassed the year-ago earnings by a penny. The rise in earnings
was due to continued investments in the company's electric
transmission systems, but partially offset by lower retail sales
from each of its business segments and higher miscellaneous
In second-quarter 2012, GAAP earnings per share were 15 cents
compared with 44 cents reported in the year-ago quarter.
The variance between pro forma and GAAP earnings resulted from
after-tax charges of 30 cents related to the merger of Northeast
In second-quarter 2012, Northeast reported operating revenue of
$1,629.0 million, up 55.4% from the year-ago figure of $1,048.0
million. Quarterly revenue beats the Zacks Consensus Estimate of
The Zacks Consensus Estimate for third-quarter 2012 is 65 cents
per share, up from 51 cents per share reported in the prior-year
quarter. Currently, the Zacks Consensus Estimate for the
company's earnings per share range between 62 cents and 70 cents.
For full-year 2012, the Zacks Consensus Estimate stands at $2.28
per share, lower than the prior-year earnings of $2.38 per share.
The current Zacks Consensus Estimate for full-year 2012 ranges
from $2.25 to $2.35 per share.
Estimate Revisions Trend
For third-quarter 2012, we have observed that 2 estimates have
moved upwards while no downward revisions were witnessed in the
last 7 days. However, we have noticed 2 upward and 1 downward
movements in the last 30 days.
For full-year 2012, there were no estimate revisions in the last
7 days. As far as last 30 days estimates revisions are concerned,
3 estimates moved upwards whereas 2 estimates went downwards.
In the last 7 days, the Zacks Consensus Estimate for
third-quarter 2012 earnings remained unchanged at 65 cents per
share. However, quarterly earnings estimate decreased by a penny
to 65 cents from 66 cents in the last 30 days.
For full-year 2012, earnings per share as per the Zacks Consensus
Estimate remained unchanged at $2.28 in the last 7 days and
decreased by a cent to $2.28 from $2.29 in the last 30 days.
With respect to earnings surprises, Northeast Utilities has
topped the Zacks Consensus Estimate in two quarters out of the
last four quarters. Over the last four quarters, the surprise
ranges from -17.65% to 7.25% with an average of -5.89%.
Northeast Utilities strongly follows organic as well as inorganic
growth strategy. As a result of merger with NSTAR, the company
has become one of the leading utility providers in the U.S. This
merged entity continues to get benefit from increased scale of
operations and a wide customer base, which subsequently enables
it to achieve higher end of earnings growth in the near future.
As far as organic growth projects are concerned, the company
intends to invest $1.7 billion under its full-year 2012
infrastructure spending programs for expansion and development of
several major projects. We believe these projects will provide
Northeast attractive earnings and cash flow growth over the
coming couple of years.
However, we are skeptical about strict regulations,
over-dependence on transmission and distribution businesses, and
risks associated with delay and cancellation of several key
Northeast Utilities currently has short-term Zacks #3 Rank (Hold
Hartford, Connecticut and Boston, Massachusetts-based Northeast
Utilities is a public utility holding company, which provides
energy delivery services to residential, commercial and
industrial customers in Connecticut, New Hampshire and
Massachusetts. The company engages in the purchase, delivery, and
sale of electricity.
With a market capitalization of $12.15 billion, Northeast has
6,063 full time employees. The company's closest peer is
NISOURCE INC (NI): Free Stock Analysis Report
NORTHEAST UTIL (NU): Free Stock Analysis
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