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Why Is Dominion Energy (D) Down 1.1% Since Last Earnings Report?

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A month has gone by since the last earnings report for Dominion Energy (D - Free Report) . Shares have lost about 1.1% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Dominion Energy due for a breakout? 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 catalysts.

Dominion Q2 Earnings in Line With Estimates, Revenues Beat

Dominion Energy Inc. has reported second-quarter 2022 operating earnings of 77 cents per share, in line with the Zacks Consensus Estimate. Quarterly earnings were within the company’s guided range of 70-80 cents per share. Operating earnings improved 1.3% year over year.

The GAAP loss for the second quarter was 58 cents per share compared with a loss of 33 cents in the year-ago quarter.

Revenues

Dominion Energy’s total revenues were $3,596 million, which surpassed the Zacks Consensus Estimate of $3,386 million by 6.2%. Revenues improved 18.4% from $3,038 million in the year-ago quarter.

Highlights of the Release

Total operating expenses increased 46.3% year over year to $3,914 million due to higher electric fuel and other energy-related purchase costs, and increases in other operations and maintenance expenses.

Interest and related charges for the reported quarter were $47 million, down 90.9% from the year-ago period.

Segmental Details

Dominion Energy Virginia: Net income from the segment was $440 million, up 2.1% year over year.

Gas Distribution: Net income from the segment was $125 million, up 31.6% from the year-ago figure.

Dominion Energy South Carolina: Net income from the segment was $124 million, up 47.6% year over year.

Contracted Assets: Net income from the segment was $20 million, down 80.8% year over year.

Corporate and Other: Net loss was $51 million compared with a loss of $86 million in the year-ago quarter.

Financial Highlights

Cash and cash equivalents as of Jun 30, 2022, were $272 million compared with $283 million as of Dec 31, 2021.

The total long-term debt as of Jun 30, 2022, was $38,259 million, up from $37,426 million as of Dec 31, 2021.

For the first half of 2022, cash from operating activities was $1,361 million compared with $2,240 million in the year-ago period.

Guidance

Dominion has given the third-quarter 2022 operating earnings guidance between 98 cents and $1.13 per share. Notably, the company reported earnings of $1.11 per share in the year-ago period. The mid-point of the guided range is $1.05, lower than the current Zacks Consensus Estimate of $1.16 per share for the same period.    

Dominion has reiterated its 2022 earnings per share view at $3.95-$4.25. The mid-point of the guidance is $4.10 per share, which is lower than the Zacks Consensus Estimate of $4.11.

Growth capital expenditure for the 2022-2026 period is expected to be $37 billion, and 85% of the planned expenditure will be directed toward lowering emissions.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended downward during the past month.

VGM Scores

Currently, Dominion Energy has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

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

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Dominion Energy 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

Dominion Energy belongs to the Zacks Utility - Electric Power industry. Another stock from the same industry, AES (AES - Free Report) , has gained 9.3% over the past month. More than a month has passed since the company reported results for the quarter ended June 2022.

AES reported revenues of $3.08 billion in the last reported quarter, representing a year-over-year change of +14%. EPS of $0.34 for the same period compares with $0.31 a year ago.

AES is expected to post earnings of $0.52 per share for the current quarter, representing a year-over-year change of +4%. Over the last 30 days, the Zacks Consensus Estimate has changed -2.2%.

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


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