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AES Corp. (AES) to Report Q2 Earnings: What's in the Cards?

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The AES Corporation (AES - Free Report) is scheduled to release second-quarter 2021 results on Aug 5, before the opening bell.

In the last reported quarter, this utility delivered a negative earnings surprise of 6.67%.

The company’s earnings surpassed the Zacks Consensus Estimate on two occasions and missed on the other two, the average surprise being 1.59%.

Let’s see how things have shaped up prior to this announcement.

Factors to Consider

AES Corp.’s joint venture with Siemens, Fluence, has been registering significant revenue growth over the past couple of quarters.  With increased demand observed in the energy storage market lately, we expect solid revenue contributions from Fluence to have boosted AES Corp.’s second-quarter top-line performance.

AES Corp. has also been focusing on monetizing excess LNG capacity, which in turn is increasing its LNG sales in Central America and the Caribbean. Such strategic measures are likely to boost the company’s second-quarter top line.

Currently, the Zacks Consensus Estimate for second-quarter revenues is pegged at $2.42 billion, which indicates a 9% rise from the year-ago quarter’s reported figure.

On the bottom-line front, factors like cost-saving initiatives, interest expense savings, reduction witnessed in overall energy costs and the Med normalization to pre-COVID levels are expected to have benefited AES Corp.’s upcoming quarterly earnings. Also, higher contributions from the Southland repowering project, which came online in mid-2020, are projected to have boosted the company’s earnings in the soon-to-be-reported quarter.

Currently, the Zacks Consensus Estimate for second-quarter earnings is pegged at 29 cents, indicating an improvement of 16% from the year-ago quarter’s reported figure.

The AES Corporation Price and EPS Surprise

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for AES Corp. 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. But this is not the case here.

Earnings ESP: The company’s Earnings ESP is +0.87%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: AES Corp. carries a Zacks Rank #4 (Sell), currently.

Stocks to Consider

Here are a few players from the Utilities sector that have the right combination of elements to post an earnings beat this season.

Duke Energy (DUK - Free Report) has an Earnings ESP of +0.15% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Telephone and Data Systems (TDS - Free Report) has an Earnings ESP of +6.33% and a Zacks Rank #3.

CenterPoint Energy (CNP - Free Report) has an Earnings ESP of +0.68% and a Zacks Rank #3.

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