What's in the Cards for NiSource (NI) This Earnings Season?

NiSource, Inc NI is scheduled to release second-quarter 2020 earnings on Aug 5, before the market opens. The company witnessed a negative earnings surprise of 5% in the last reported quarter.

Let’s discuss the factors that are likely to get reflected in the upcoming quarterly results.

Factors to Consider

Second-quarter results are likely to reflect the negative impact of soft demand from the commercial and industrial (C&I) customers group due to the lockdown. However, stay-at-home orders might have raised the residential load and mitigated the weakness in demand from the C&I group to some extent. Also, NiSource reduced its capital expenditure estimates, issued notes to strengthen liquidity and lowered financing risk amid the ongoing pandemic. New gas rates implemented during the second quarter are also expected to have boosted earnings.

Moreover, the company made several efforts to support its customers during the pandemic but payment flexibility might have affected its cash balance. 

Q2 Expectations

The Zacks Consensus Estimate for second-quarter 2020 sales is pegged at $1.07 billion, which indicates an increase of 6.22% from the year-ago quarter’s reported figure. The Zacks Consensus Estimate for second-quarter earnings per share is pegged at 7 cents per share, which suggests growth of 40% from the year-earlier quarter’s reported number.

What Our Quantitative Model Predicts

Our proven model doesn’t conclusively predict an earnings beat for NiSource this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here as you will see below. You can see the complete list of today’s Zacks #1 Rank stocks here.

NiSource, Inc Price and EPS Surprise

NiSource, Inc Price and EPS Surprise

NiSource, Inc price-eps-surprise | NiSource, Inc Quote

Earnings ESP: NiSource has an Earnings ESP of +9.09%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, NiSource carries a Zacks Rank #4 (Sell).

Stocks to Consider

Here are some companies worth considering from the same industry, which according to our model, have the right combination of elements to beat on earnings in the upcoming releases.

WEC Energy Group, Inc. WEC is set to release second-quarter earnings on Aug 4. It has an Earnings ESP of +0.96% and a Zacks Rank #2, presently.

Pinnacle West Capital Corporation PNW is set to release second-quarter earnings on Aug 6. It has an Earnings ESP of +5.07% and a Zacks Rank #3, currently.

CenterPoint Energy, Inc. CNP is expected to release second-quarter numbers on Aug 6. It has an Earnings ESP of +7.87% and a Zacks Rank of 3 at present.

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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.

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