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| Company Name | Symbol | %Change |
|---|---|---|
| FEDERAL MOGU | FDML | 8.53% |
| SCIENTIFIC L | SCIL | 8.00% |
| RADIANT LOGI | RLGT | 6.38% |
| SUMMER INFAN | SUMR | 5.42% |
| NATUS MEDICA | BABY | 5.13% |
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We expect diversified utility holding company Wisconsin Energy Corporation ( WEC - Analyst Report ) to beat expectations when it reports fourth-quarter 2012 results on Jan 30, 2013.
Why a Likely Positive Surprise?
Our proven model shows that Wisconsin Energy is likely to beat earnings because it has the right combination of two key ingredients:
Positive Zacks ESP: Earnings Surprise Prediction or ESP (Read: Zacks Earnings ESP: A Better Method), which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is at 2.38%. This is very meaningful and a leading indicator of a likely positive earnings surprise for shares.
Zacks #1 Rank (Strong Buy): We note that stocks with Zacks Ranks of #1, #2 and #3 have a significantly higher chance of beating earnings. The Sell rated stocks (#4 and #5) should never be considered going into an earnings announcement.
The combination of Wisconsin Energy’s Zacks Rank #1 (Strong Buy) and 2.38% ESP make us very confident in looking for a positive earnings beat on Jan 30, 2013.
What is Driving the Better-Than-Expected Earnings?
Strong contribution from Wisconsin Energy’s recently completed ‘Power the Future’ plan, and steady progress on its two projects: a biomass plant in Rothschild and the air quality control improvement at the original Oak Creek units are expected to lead to a positive earnings surprise in the forthcoming quarter.
The positive trend is seen in the trailing four quarter’s average surprise of 9.77%, which was greatly helped by the 17.54% surprise in the last-reported quarter. This happened due to decline in operation and maintenance costs, strong recovery of fuel costs, and positive impacts from the share repurchase program.
Other Stocks to Consider
Wisconsin Energy is not the only company looking up this earnings season. We also see likely earnings beat coming from other utility providers.
Clean Energy Fuels Corp. ( CLNE - Snapshot Report ) , Earnings ESP of +87.50% and Zacks Rank #2 (Buy)
Public Service Enterprise Group Inc. ( PEG - Analyst Report ) , Earnings ESP of +5.26% and Zacks Rank #3 (Hold)
TECO Energy, Inc. ( TE - Analyst Report ) , Earnings ESP of +20.00% and Zacks Rank #3 (Hold)
Read the full reports :
Analyst Report on WEC
Analyst Report on TE
Analyst Report on PEG
Snapshot Report on CLNE