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Exelon (EXC) Q3 Earnings: Can the Stock Pull a Surprise?

Exelon CorporationEXC is set to release third-quarter 2016 results before the opening bell on Oct 26. Last quarter, this electric and natural gas utility reported a positive earnings surprise of 16.07%. Over the last four quarters, the company has delivered an average positive earnings surprise of 8.36%. Let's see what is store for this utility this season.

Factors to Consider

Exelon expects third-quarter earnings in the range of 65 to 75 cents per share. Warmer-than-expected temperatures in the quarter might have a positive impact on the company's earnings.

Exelon is benefiting from the acquisition of Pepco Holdings and the positive regulatory ruling at BGE Electric and Natural Gas Distribution, which will aid additional combined annual revenues of $92 million.

During the quarter, Exelon suffered a defeat in a court case with Internal Revenue Service (IRS). The court ruled against the accounting treatment of profits in relation to the sale of coal plants in 1999. This ruling will potentially impact Exelon, compelling the company to pay $870M in taxes, interest and penalties to the IRS.

EXELON CORP Price and EPS Surprise

EXELON CORP Price and EPS Surprise | EXELON CORP Quote

Earnings Whispers

Our proven model does not conclusively show that Exelon Corporation is likely to beat the Zacks Consensus Estimate in the third quarter. That 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. That is not the case here, as you will see below.

Zacks ESP : ESP for Exelon is 0.00%. This is because both the Most Accurate Estimate and the Zacks Consensus Estimate are pegged at 74 cents.

Zacks Rank : Exelon currently carries a Zacks Rank #3, which when combined with a 0.00% ESP, makes surprise prediction difficult this season.

We caution against stocks with Zacks Ranks #4 and #5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks to Consider

Exelon may not have the perfect combination for an earnings beat this season, but we have several other utility companies looking up this earnings season.

CMS Energy CMS is expected to release third-quarter 2016 results on Oct 27, before the market opens. The company has an Earnings ESP of +5.26% and a Zacks Rank #1.You can see the complete list of today's Zacks #1 Rank stocks here .

DTE Energy Company DTE has an Earnings ESP of +4.64% and a Zacks Rank #2. The company is expected to release third-quarter 2016 results on Oct 26, before the market opens.

WEC Energy Group WEC has an Earnings ESP of +5.09% and a Zacks Rank #2. The company is expected to release third-quarter 2016 results before the market opens on Oct 26.

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WEC ENERGY GRP (WEC): Free Stock Analysis Report

CMS ENERGY (CMS): Free Stock Analysis Report

EXELON CORP (EXC): Free Stock Analysis Report

DTE ENERGY CO (DTE): Free Stock Analysis Report

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


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

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