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What's in Store for American Electric (AEP) in Q1 Earnings?

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American Electric Power Company, Inc (AEP - Free Report) is slated to release first-quarter 2024 results on Apr 30, before the opening bell.

In the last reported quarter, the company delivered a negative earnings surprise of 3.15%. American Electric has a trailing four-quarter average negative earnings surprise of 1.09%.

Factors to Note

AEP’s service territories observed mixed weather conditions in the first quarter. While cool temperature was experienced in the company’s service areas at the onset of the January-March quarter, warmer-than-normal temperature prevailed in the latter part of the quarter. Such mixed weather conditions can be expected to have had a moderate impact on American Electric's top line in the first quarter.

Other factors like increased retail load, transmission revenues as well as favorable rate hikes in the previous quarters must have also aided AEP’s quarterly results.

In January 2024, American Electric received an unfavorable order from the Federal Energy Regulatory Commission (FERC) related to the treatment of accumulated deferred income taxes associated with net operating loss (NOLC) carryforwards. This, along with increased interest expenses, might have had some adverse impact on the company’s bottom-line performance in the first quarter.

Nevertheless, benefits from favorable investments in the prior quarters, along with solid sales expectations, favorable depreciation expenses and lower operating and maintenance (O&M) expenses, are likely to have bolstered the company’s overall earnings in the soon-to-be-reported quarter.

Q1 Expectations

The Zacks Consensus Estimate for AEP’s first-quarter revenues is pegged at $5.21 billion, indicating an improvement of 10.8% from the year-ago quarter’s reported figure.

The Zacks Consensus Estimate for first-quarter earnings is pegged at $1.32 per share, implying an increase of 18.9% from the prior-year reported figure.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for American Electric this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat, which is not the case here.

Earnings ESP: The company’s Earnings ESP is -4.03%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: AEP carries a Zacks Rank #3 at present.

Stocks to Consider

Here are three Utility players that have the right combination of elements to come up with an earnings beat this reporting cycle.

Center Point Energy (CNP - Free Report) is expected to report first-quarter 2024 results on Apr 30, before market open. It has an Earnings ESP of +3.92% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for CNP’s first-quarter earnings is pegged at 51 cents per share, which implies a 2% improvement from the first-quarter 2023 reported figure. The Zacks Consensus Estimate for first-quarter sales is pegged at $2.81 billion, indicating a 1.1% increase from the top line reported in the prior-year quarter.

Clean Energy Fuels (CLNE - Free Report) has an Earnings ESP of +68.75% and a Zacks Rank #3 at present. The company has a four-quarter average earnings surprise of 4.17%

The Zacks Consensus Estimate for CLNE’s first-quarter earnings is pegged at a loss of 3 cents, indicating an improvement from the prior-year quarter’s reported loss of 7 cents. The consensus estimate for sales is pegged at $106.6 million.

Eversource Energy (ES - Free Report) has an Earnings ESP of +2.76% and a Zacks Rank #2 at present. The consensus estimate for first-quarter earnings is pinned at $1.45 per share, indicating a 2.8% increase year over year.

ES delivered a trailing four-quarter average earnings surprise of 2.08%. The consensus mark for first-quarter sales is pegged at $4.14 billion, indicating growth of 9.1% from the top line recorded in the prior-year quarter.

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

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