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Why Is Exelon (EXC) Up 4.9% Since Last Earnings Report?

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It has been about a month since the last earnings report for Exelon (EXC - Free Report) . Shares have added about 4.9% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Exelon due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Exelon's Q1 Earnings Miss Estimates, Revenues Beat

Exelon Corporation’s first-quarter 2022 earnings of 64 cents per share lagged the Zacks Consensus Estimate of 66 cents by 3%.

The bottom line improved 16.4% from the year-ago quarter’s earnings of 55 cents per share. The year-over-year increase was primarily due to higher electric distribution earnings at ComEd and rate increases at PECO, BGE and PHI.

On a GAAP basis, first-quarter earnings were 49 cents per share compared with 53 cents in the year-ago quarter. The difference in GAAP and operating earnings per share was due to separation costs and income-tax related adjustments.

Total Revenues

Exelon's first-quarter total revenues of $5.32 billion surpassed the Zacks Consensus Estimate of $4.6 billion by 15.6%. The top line also improved nearly 15% from the year-ago figure of $4.63 billion.

Highlights of the Release

Exelon's first-quarter total operating expenses increased nearly 16.3% year over year to $4.42 billion. The increase was due to a rise in purchased power and fuel expenses.

Operating income came in at $900 million, up 9.2% year over year.

Interest expenses totaled $338 million, up 6.3% from the year-ago quarter.

Financial Highlights

Cash and cash equivalents were $2,476 million as of Mar 31, 2022 compared with $673 million as of Dec 31, 2021.

Long-term debt was $35,008 million as of Mar 31, 2022 compared with $30,749 million as of Dec 31, 2021.

Cash provided (used in) from operating activities for first three months of 2022 was $1,782 million compared with ($1,261) million in the first three months of 2021.

Guidance

Exelon expects its 2022 earnings in the range of $2.18-$2.32 per share. The midpoint of the revised guided range is $2.25, lower than the Zacks Consensus Estimate of $2.27 per share for the period.

Exelon has plans to invest $29 billion during 2022-2025 to further strengthen its electric transmission and distribution as well as gas delivery infrastructure.

Exelon expects earnings and dividend per share (subject to board’s approval) to increase in the range of 6-8% through 2025.

How Have Estimates Been Moving Since Then?

It turns out, estimates review have trended upward during the past month.

VGM Scores

Currently, Exelon has an average Growth Score of C, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision has been net zero. Notably, Exelon has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Exelon belongs to the Zacks Utility - Electric Power industry. Another stock from the same industry, PSEG (PEG - Free Report) , has gained 0.9% over the past month. More than a month has passed since the company reported results for the quarter ended March 2022.

PSEG reported revenues of $2.31 billion in the last reported quarter, representing a year-over-year change of -19.9%. EPS of $1.33 for the same period compares with $1.28 a year ago.

PSEG is expected to post earnings of $0.70 per share for the current quarter, representing no change from the year-ago quarter. Over the last 30 days, the Zacks Consensus Estimate has changed -5.6%.

The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for PSEG. Also, the stock has a VGM Score of C.


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