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What's in Store for NextEra Energy Partners (NEP) in Q2 Earnings?

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NextEra Energy Partners, LP (NEP - Free Report) is scheduled to release second-quarter 2023 results on Jul 25, before market open. The firm delivered a negative earnings surprise of 154.84% in the last reported quarter.

Let’s discuss the factors that are likely to be reflected in the upcoming quarterly results.

Factors to Note

NextEra Energy Partners’ second-quarter earnings are expected to have benefited from ongoing growth of its high-quality renewable energy portfolio. The firm had nearly 18 gigawatts (GW) renewables in backlog in the to-be-reported quarter. NEP is expected to further boost its generation portfolio by closing an acquisition worth 690 megawatts from Energy Resources.

The Zacks Consensus Estimate for second-quarter operating revenues for the Renewable segment is pegged at $334.2 million, indicating growth of 10.7% from the year-ago quarter’s reported figure.

The consensus estimate for Texas Pipelines’ operating revenues is pinned at $57.1 million, indicating a year-over-year decline of 4.8%.

The company continues to enjoy structural tax advantages and is not likely to pay meaningful U.S. taxes for at least 15 years. This might have also bolstered its second-quarter earnings.

Q2 Expectations

The Zacks Consensus Estimate for NextEra Energy Partners’ earnings is pegged at 72 cents per unit, implying a year-over-year decrease of 72.4%.

The consensus mark for revenues is pinned at $392.92 million, indicating an 8.6% increase year over year.

Our Zacks model predicts renewable energy sales to contribute 85.1% to the company’s total revenues compared with 83.4% in the year-ago quarter.

Quantitative Model Predicts

Our proven model does not conclusively predict an earnings beat for NextEra Energy Partners this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. That is not the case here as you will see below.
 

Earnings ESP: NEP’s Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, the company carries a Zacks Rank #3. You can see the complete list of today's Zacks #1 Rank stocks here.

Stocks to Consider

Here are a few players from the same sector that have the right combination of elements to come up with an earnings beat this reporting cycle.

TC Energy Corporation (TRP - Free Report) is likely to report an earnings beat when it announces second-quarter results on Jul 28, before market open. It has an Earnings ESP of +14.72% and a Zacks Rank #2 at present.

TRP’s long-term (three to five years) earnings growth rate is 4%. It delivered an average earnings surprise of 2.1% in the last four quarters.

Plains All American Pipeline (PAA - Free Report) is expected to post an earnings beat when it announces second-quarter results on Aug 4, before market open. It has an Earnings ESP of +34.62% and a Zacks Rank #3 at present.

The Zacks Consensus Estimate for PAA’s earnings is pegged at 21 cents per unit. It delivered an average earnings surprise of 11.5% in the last four quarters.

Cactus, Inc. (WHD - Free Report) is expected to come up with an earnings beat when it reports second-quarter results on Aug 7, after market close. It has an Earnings ESP of +4.41% and a Zacks Rank #3 at present.

WHD’s long-term earnings growth rate is 5.79%. It delivered an average earnings surprise of 13.6% in the last four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

 

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