Entergy Upbeat on 1Q Prelim Earnings - Analyst Blog

By Zacks Equity Research,

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Entergy Corp. ( ETR ) expects preliminary first quarter 2013 operational earnings of 93 cents per share, above the Zacks Consensus Estimate of 66 cents by almost 41%. The expectation is also higher considerably from the year-ago profit of 44 cents.

The improved outlook is mainly due to better performance at Utility and Entergy Wholesale Commodities.

On a reported basis, the company expects first quarter earnings to be approximately 89 cents a share, reversing its loss per share of 86 cents incurred in the same period last year.

For its Utility division, Entergy expects to generate higher revenues in the first quarter mainly due to pricing adjustments for the investments made last year related to nuclear and combined cycle natural gas-fired generation. Again, the company also hopes to incur lower income tax expense due to a prior-period item. This segment, however, will likely experience higher non-fuel operation and maintenance and depreciation expenses.

At Entergy Wholesale Commodities, higher nuclear energy and capacity pricing also led to the increase in earnings. This is partially tempered by an increase in nuclear refueling and unplanned outage days.

However, results from its Parent & Other segment dropped as numerous individually insignificant items hindered quarterly segment earnings.

Entergy maintained its 2013 earnings guidance in the range of $4.60 to $5.40 per share on an operational basis. However, the company revised its as-reported earnings assumption to $4.56 to $5.36 per share from $4.60 to $5.40 earlier, reflecting expenses related to the proposed spin-off and merger of the transmission business with ITC Holdings Corporation ( ITC ).

New Orleans-based Entergy Corp. is primarily engaged in electric power production and retail distribution of power. The company remains well positioned with its geographically diverse mix of regulated and merchant operations. The company is focused on maximizing shareholder value through steady investment in rate base growth, as well as through its ongoing stock buyback program and incremental dividend payments.

Entergy − the second largest U.S. nuclear power generator after Exelon Corporation ( EXC ) − is scheduled to report first quarter 2013 financial results on Apr 25 before the earnings bell.

The company has a Zacks Rank #3 (Hold). However, we would advise investors to focus on Zacks Rank #1 (Strong Buy) electric power utility Pike Electric Corporation ( PIKE ).

ENTERGY CORP (ETR): Free Stock Analysis Report

EXELON CORP (EXC): Free Stock Analysis Report

ITC HOLDINGS CP (ITC): Free Stock Analysis Report

PIKE ELECTRIC (PIKE): Free Stock Analysis Report

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Earnings , Stocks
Referenced Stocks: ETR , EXC , ITC , PIKE

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