We expect diversified utility company
TECO Energy, Inc.
) to beat expectations when it reports fourth-quarter 2013
results on Jan 30, 2014.
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Why a Likely Positive Surprise?
Our proven model shows that TECO Energy is likely to beat
earnings because it has the right combination of key factors.
Positive Zacks ESP:
(Expected Surprise Prediction), which represents the difference
between the Most Accurate estimate and the Zacks Consensus
Estimate, is +4.76%. This is meaningful and a leading indicator
of a likely positive earnings surprise for this company.
Zacks #3 Rank (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 never be considered going into an earnings
The combination of TECO Energy's Zacks Rank #3 (Hold) and +4.76%
ESP make us confident of a positive earnings beat on Jan 30.
What is Driving Better-than-Expected Earnings?
In Sep 2013, TECO Energy's subsidiary Tampa Electric Company
received an approval from the Florida Public Service Commission
to increase the monthly rates of the residential electricity
customers. The regulated utility providers recoup their
investments from the customers through the filing of rate hike.
The timely sanction of rate-hike request will encourage the
utility company to invest more to upgrade its asset base. These
initiatives will enable the company to provide uninterrupted
services to its customers.
In addition, gradual improvement of economy at the state of
Florida including housing market recovery, a decrease in
unemployment rate and creation of new jobs will influence the
consumers to pay utility bills on time and create opportunities
for addition of new customers to its portfolio. These factors
will fuel TECO Energy's future performance.
Other Stocks to Consider
TECO Energy is not the only company looking up this earnings
season. We also see likely earnings beat coming from other
Wisconsin Energy Corp.
), Earnings ESP of +5.26% and Zacks Rank #2 (Buy).
), Earnings ESP of +2.86% and Zacks Rank #3 (Hold).
Xcel Energy Inc.
), Earnings ESP of +3.45% and Zacks Rank #3 (Hold).