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Why Is HEI (HE) Down 9.3% Since Last Earnings Report?

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A month has gone by since the last earnings report for Hawaiian Electric (HE - Free Report) . Shares have lost about 9.3% in that time frame, underperforming the S&P 500.

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

Hawaiian Electric Q2 Earnings Lag Estimates, Sales Up Y/Y

Hawaiian Electric reported earnings per share (EPS) of 48 cents for the second quarter of 2022, which lagged the Zacks Consensus Estimate of 52 cents by 7.7%.

The bottom line also declined 17.2% from 58 cents per share in the prior-year quarter, primarily due to the prior year's negative provision for credit losses at American Savings Bank and a return to a more normalized provision expense due to strong loan growth.

Total Revenues

Hawaiian Electric’s total revenues of $895.6 million in the second quarter improved 31.7% from the prior-year quarter’s $680.3 million. The rise in revenues can be attributed to increased contributions from the Electric Utility and Other segments.

Segment Details

Electric Utility: Revenues in this segment totaled $818.9 million, up 36.1% year over year.

Banking: In this segment, revenues totaled $75.3 million, down 2.5% year over year.

Others: Revenues from other sources surged 26.1% to $1,410 million from $1,118 million in the year-ago quarter.

Operating Statistics

Total expenses increased 39.9% year over year to $808.9 million in the second quarter. The increase can be attributed to higher expenses in the Electric Utility and Bank segments and Other segments.

The total operating income declined 14.9% year over year to $86.7 million in the second quarter.

Net interest expenses during the quarter amounted to $24.9 million, up 7.1% from $23.3 million in the prior-year quarter.

2022 Guidance

Hawaiian Electric reiterated its 2022 EPS guidance in the range of $2.00-$2.20. The Zacks Consensus Estimate for earnings, pegged at $2.19, lies at the higher end of the company’s guided range.

How Have Estimates Been Moving Since Then?

Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.

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