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Why Is Edison International (EIX) Up 13.4% Since Last Earnings Report?

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A month has gone by since the last earnings report for Edison International (EIX - Free Report) . Shares have added about 13.4% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Edison International 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.

Edison International Q3 Earnings Meet, EPS View Down

Edison International reported third-quarter 2022 adjusted earnings of $1.48 per share, which came in line with the Zacks Consensus Estimate. However, the bottom declined 12.4% from $1.69 in the year-ago quarter.

The company recorded a GAAP loss of 33 cents per share compared with the 90 cents reported in the third quarter of 2021.

Total Revenues

Edison International's third-quarter revenues totaled $5,228 million, which surpassed the Zacks Consensus Estimate of $4,988 million by 4.8%. However, the top line declined 1.3% from the year-ago quarter’s $5,299 million.

Operational Highlights

In the reported quarter, total operating expenses decreased 2.9% year over year to $5,272 million.

Purchased power and fuel costs rose 19%, while depreciation and amortization expenses increased 23.2%.

Operation and maintenance costs decreased 19.9% year over year, whereas property and other taxes increased 13.3% from the prior-year quarter figure.

The operating loss amounted to $44 million in the third quarter of 2022 compared with the operating loss of $128 million in the year-ago quarter.

Segment Results

Southern California Edison’s (“SCE”) third-quarter adjusted earnings were $1.63 per share compared with $1.84 in the year ago quarter. The decrease in SCE’s core earnings can be attributed to higher revenues from the 2021 General Rate Case final decision.

Edison International Parent and Other incurred a loss of 15 cents per share, in line with the year-ago quarter’s loss.

Financial Update

As of Sep 30, 2022, Edison International's cash and cash equivalents amounted to $232 million compared with $390 million as of Dec 31, 2021.

The long-term debt was $25.15 billion as of Sep 30, 2022, higher than the 2021-end level of $24.18 billion.

Net cash flow from operating activities for the nine months ended Sep 30, 2022 was $2,112 million compared to the cash outflow of $416 million in the prior-year period.

Total capital expenditures summed at $4,206 million for the nine months ended Sep 30, 2022, up from $3,948 million in the year-ago period.

2022 Guidance

The company narrowed its 2022 guidance. EIX now expects adjusted earnings in the range of $4.48-$4.68 compared with the prior guided range of $4.40-$4.70 per share.

The Zacks Consensus Estimate for earnings is currently pegged at $4.49 per share, which is toward the lower end of the company’s guided range.

How Have Estimates Been Moving Since Then?

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

The consensus estimate has shifted 8.42% due to these changes.

VGM Scores

At this time, Edison International has a nice Growth Score of B, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of A. 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 looks promising. Notably, Edison International 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

Edison International belongs to the Zacks Utility - Electric Power industry. Another stock from the same industry, FirstEnergy (FE - Free Report) , has gained 8.6% over the past month. More than a month has passed since the company reported results for the quarter ended September 2022.

FirstEnergy reported revenues of $3.48 billion in the last reported quarter, representing a year-over-year change of +11.2%. EPS of $0.79 for the same period compares with $0.82 a year ago.

FirstEnergy is expected to post earnings of $0.54 per share for the current quarter, representing a year-over-year change of +5.9%. Over the last 30 days, the Zacks Consensus Estimate has changed +1.3%.

FirstEnergy has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.


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