Duke Energy Corporation DUK is set to report fourth-quarter 2018 results on Feb 14, before the opening bell.
In the las t report ed quarter, the company delivered a positive earnings surprise of 7.84%. Moreover, earnings surpassed the Zacks Consensus Estimate in three of the past four quarters, the average beat being 3.18%.
Let's see how things are shaping up prior to this announcement. Factors under Consideration
During the fourth quarter, hurricanes and thunderstorms led to widespread devastation in certain parts of Florida, Kentucky and the Carolinas. This may have led to prolonged power outages leading to disruption in smooth power supply.
In December, the company forecasted an approaching winter storm that could result in approximately 500,000 power outages or more for homes and businesses in the Carolinas.
As a result, temperature is most likely to reflect an unfavorable impact on Duke Energy's revenues in the to-be-reported quarter. In line with this, the Zacks Consensus Estimate for Duke Energy's fourth-quarter revenues is anticipated to decline 4.1% year over year to $5.61 billion.
From the bottom-line perspective, Hurricane Michael is expected to have an unfavorable impact on Duke Energy's Electric Utilities and Infrastructure business segments. The company now is anticipated to experience higher operations and maintenance (O&M) costs led by the storm, apart from other infrastructural damages and losses. Per company officials, the preliminary O&M cost estimates for Hurricane Michael will approximately be around $200 million.
In line with this, the Zacks Consensus Estimate for Duke Energy's fourth-quarter earnings pegged at 89 cents reflects an annual decline of 5.3%. What the Zacks Model Unveils
Our proven model does not conclusively show that Duke Energy is likely to beat estimates in the fourth quarter. This is because a stock needs to have both - a positive Earnings ESP
and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) - for this to happen. Earnings ESP
: Duke Energy has an Earnings ESP of -2.26%. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter
. Zacks Rank
: Duke Energy has a Zacks Rank #3.
Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Duke Energy Corporation Price and EPS Surprise
Duke Energy Corporation Price and EPS Surprise | Duke Energy Corporation Quote
Stocks That Warrant a Look
Here are a few operators in the Utility space you may consider, as our model shows that these have the right combination of elements to deliver an earnings beat this quarter:
Allete, Inc. ALE has an Earnings ESP of +5.26% and a Zacks Rank #2. The company is scheduled to report fourth-quarter results on Feb 14. You can see the complete list of today's Zacks #1 Rank stocks here .
Consolidated Edison Inc ED has an Earnings ESP of +0.33% and a Zacks Rank #3. The company is scheduled to report fourth-quarter results on Feb 21.
OGE Energy Corporation OGE has an Earnings ESP of +1.41% and a Zacks Rank #3. The company is scheduled to report fourth-quarter results on Feb 21.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report OGE Energy Corporation (OGE): Get Free Report Duke Energy Corporation (DUK): Free Stock Analysis Report Allete, Inc. (ALE): Free Stock Analysis Report Consolidated Edison Inc (ED): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research