Pattern Energy (PEGI) Up 2.8% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for Pattern Energy (PEGI). Shares have added about 2.8% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Pattern Energy due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Pattern Energy Q3 Loss Narrows Y/Y on Solid Revenues
Pattern Energy Group posted third-quarter 2018 operating loss of 13 cents per share, wider than the Zacks Consensus Estimate of a loss of 4 cents. The company reported a loss of 34 cents in the year-ago quarter.
The year-over-year upside was driven by solid top-line growth along with gains on derivatives.
Total revenues amounted to $118.4 million, which lagged the Zacks Consensus Estimate of $123 million by 3.7%. However, the figure improved 28.6% from $92 million reported in the prior-year quarter.
Pattern Energy sold 1,622,991 megawatt hours ("MWh") of electricity on a proportional basis in the reported quarter compared with 1,513,997 MWh in the year-ago quarter.
Total operating expenses in the reported quarter increased 25.7% from the year-ago quarter's level to $15.9 million.
The company incurred interest expenses of $27.5 million, up 1.2% from the year-ago quarter's tally.
In the third quarter, Pattern Energy acquired a 51%-owned interest in the 143 MW Mont Sainte-Marguerite project in Québec for a purchase price of $37.7 million. It also completed the sale of operations worth 81 MW interest in the 115 MW El Arrayán project in Chile, for cash proceeds of $70.4 million.
As of Sep 30, 2018, the company had cash and cash equivalents of $125.7 million compared with $116.8 million on Dec 31, 2017.
Its long-term debt was $2,105.8 million as of Sep 30, 2018, up from Dec 31, 2017 level of $1,878.7 million.
The company's cash flow from operating activities in the first nine months of 2018 was $230.5 million, up from $159.3 million in the year-ago period.
Pattern Energy reaffirmed targeted annual cash available for distribution for 2018 within $151-$181 million.
How Have Estimates Been Moving Since Then?
Fresh estimates followed an upward path over the past two months. The consensus estimate has shifted -17.14% due to these changes.
Currently, Pattern Energy has a nice Growth Score of B, however its Momentum Score is doing a bit better with an A. However, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Pattern Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.