Entergy's Earnings Likely to Beat - Analyst Blog


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Entergy Corp. ( ETR ) will release its first quarter 2013 financial results before the market opens on Apr 25, 2013. In the prior quarter, this electric utility reported an earnings surprise of 21.99%. Let's see how things are shaping up at Entergy prior to this announcement.

Why a Likely Positive Surprise?

Our proven model indicates that Entergy Corp. is likely to beat earnings because it has the right combination of two key ingredients.

Positive Zacks ESP: Expected Surprise Prediction or ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is at +30.44%. This is a leading indicator of a likely positive earnings surprise for the shares.

Zacks Rank #3 (Hold): The stocks with Zacks Ranks of #1, #2 and #3 have a significantly higher chance of beating earnings. The Sell rated stocks (#4 and #5) should be avoided going into an earnings announcement.  

The combination of Entergy Corporation's Zacks Rank #3 (Hold) and +30.44% ESP makes us confident of a positive earnings beat on Apr 25.

What is Driving Better-than-Expected Earnings?

The first quarter 2013 performance is expected to be driven by the Utility and Entergy Wholesale Commodities segments.

Favorable price adjustments and lower income tax expenses are expected to benefit the Utility segment. Weather in the first quarter was more favorable than the comparable prior-year period which also boosted demand at Utility. The Wholesale Commodities segment was driven by higher nuclear energy and capacity pricing.

Other Stocks to Consider

Other companies in the utility industry worth considering on the basis of our model, which shows that they have the right combination of elements to post an earnings beat this quarter, include the following:

Brookfield Infrastructure Partners L.P. ( BIP ) has earnings ESP of +1.19% and carries a Zacks Rank #1 (Strong Buy).

Cleco Corporation ( CNL ) has earnings ESP of +8.16% and carries a Zacks Rank #2 (Buy).

American Electric Power Company Inc ( AEP ) has earnings ESP of +2.47% and carries a Zacks Rank #2 (Buy).

AMER ELEC PWR (AEP): Free Stock Analysis Report

BROOKFIELD INFR (BIP): Free Stock Analysis Report

CLECO CORP (CNL): Free Stock Analysis Report

ENTERGY CORP (ETR): 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
More Headlines for: AEP , BIP , CNL , ETR

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