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FirstEnergy's (FE) Q4 Earnings Miss Estimates, Sales Rise Y/Y

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FirstEnergy Corporation (FE - Free Report) delivered fourth-quarter 2021 operating earnings per share (EPS) of 51 cents, which missed the Zacks Consensus Estimate of 52 cents by 1.9%. However, the bottom line improved 59.4% from the year-ago earnings of 32 cents per share.

On a GAAP basis, FirstEnergy reported fourth-quarter 2021 earnings of 77cents per share, up 71.1% from the prior-year quarter of 45 cents.

FirstEnergy reported operating EPS of $2.60 in 2021, up 9% compared with $2.39 in 2020.

Total Revenues

FirstEnergy generated revenues of $2,660 million in the fourth quarter, which lagged the Zacks Consensus Estimate of $2,805 million by 5.2%. The top line improved 4.8% from $2,537 million in the year-ago quarter.

FirstEnergy Corporation Price, Consensus and EPS Surprise

FirstEnergy Corporation Price, Consensus and EPS Surprise

FirstEnergy Corporation price-consensus-eps-surprise-chart | FirstEnergy Corporation Quote

Highlights of the Release

In the fourth quarter of 2021, residential sales decreased 1.4% due to lower electricity demand, with the ease of pandemic-related restrictions in 2021, compared with the fourth quarter of 2020. Commercial deliveries increased 1.2%, while industrial sales improved 3.5% year over year due to the continued recovery from the pandemic and recessionary conditions. Total distribution deliveries moved up 1.1% from the prior-year quarter’s level.

Total operating expenses for the fourth quarter amounted to $2,228 million, up 4.6% from the year-ago quarter’s $2,130million, due to the higher purchasing power cost and an increase in general taxes.

In the fourth quarter, operating income was $432 million, down 6.1% from $407 million in the year-ago quarter.

Financial Update

FirstEnergy had cash, cash equivalents and restricted cash worth $1,511 million as of Dec 31, 2021, compared with $1,801 million on Dec 31, 2020.

Long-term debt and other long-term obligations as of Dec 31, 2021, were $22,248 million, up 0.53% from $22,131 million on Dec 31, 2020.

Net cash provided by operating activities as of Dec 31, 2021, was $2,811 million compared with $1,423 million in the comparable period a year ago.

Guidance

FirstEnergy provided 2022 earnings guidance in the range of $2.30 to $2.50 per share. The Zacks Consensus Estimate for 2022 earnings of $2.43 per share is higher than $2.40, which is the midpoint of the guided range.

FirstEnergy plans to invest $3.3 billion in 2022, up 15% compared with 2021, to strengthen the grid and lead the clean energy transition. FE expects to invest $17 billion in the 2021-2025 period, which will be directed toward grid modernization and increasing resiliency, conservation & clean energy transition and customer-centric growth projects.

Zacks Rank

FirstEnergy currently has a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

IDA Corp (IDA - Free Report) is slated to report fourth-quarter 2021 earnings on Feb 17 before market open. The Zacks Consensus Estimate for the fourth quarter’s EPS is pegged at 67 cents.

IDA Corp’s long-term (three to five years) earnings growth is currently pegged at 4.42%. The Zacks Consensus Estimate for IDA’s 2022 earnings implies year-over-year growth of 2.67%.

Alliant Energy Corp. (LNT - Free Report) is slated to report fourth-quarter 2021 earnings on Feb 18 after market close. The Zacks Consensus Estimate for the fourth quarter’s EPS is pegged at 35 cents.

Alliant Energy’s long-term earnings growth is currently pegged at 6.06%. The Zacks Consensus Estimate for LNT’s 2022 earnings implies year-over-year growth of 4.17%.

Entergy Corp. (ETR - Free Report) is slated to report fourth-quarter 2021 earnings on Feb 23 before market open. The Zacks Consensus Estimate for the fourth quarter’s EPS is pegged at 68 cents.

Entergy’s long-term earnings growth is currently pegged at 1%. The Zacks Consensus Estimate for ETR’s 2022 earnings implies year-over-year growth of 5.85%.