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Pinnacle West (PNW) Q4 Earnings Top on New Retail Rates

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Pinnacle West Capital Corporation (PNW - Free Report) reported adjusted earnings per share of 19 cents in the fourth quarter of 2017, surpassing the Zacks Consensus Estimate of 10 cents by 90%.

Despite an increase in retail rates and revenues, earnings were lower than the year-ago quarter  due to higher operating expenses, effects of  weather and a higher effective tax rate.

Total Revenues

In the quarter under review, total revenues of $759.7 million reflected year-over-year growth of 2.75%.

Operational Highlights

In 2017, higher operations and maintenance expenses adversely impacted earnings by 3 cents per share compared with the prior-year period. The increased expenses were largely due to higher employee benefit costs.

In 2017, effects of weather variations positively impacted earnings by 3 cents per share compared with 2016.

Operating income in 2017 increased 9.2% year over year to $934.4 million.

Full-year interest expenses were up 6.4% to $197.7 million from $185.8 million in 2016.

Guidance

Pinnacle West Capital increased 2018 earnings guidance in the range of $4.35 to $4.55 per share from $4.25 to $4.45 per share a year ago.

Zacks Rank

Pinnacle West Capital carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Peer Releases

Dominion Energy Inc. (D - Free Report) reported fourth-quarter 2017 operating earnings of 91 cents per share, beating the Zacks Consensus Estimate of 88 cents by 3.4%.

NextEra Energy, Inc. (NEE - Free Report) reported fourth-quarter 2017 adjusted earnings of $1.25 per share, missing the Zacks Consensus Estimate of $1.31 by 4.58%.

FirstEnergy Corp. (FE - Free Report) reported fourth-quarter 2017 operating earnings of 71 cents per share, beating the Zacks Consensus Estimate of 69 cents by 2.9%.

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