The Q3 earnings cycle is drawing to a close, with approximately 87.1% of the market cap of the S&P 500 index having released quarterly numbers as of Nov 4. Reported results reveal a 3.6% increase in third-quarter earnings on 2.4% higher revenues.
About 77 S&P 500 members will report results in the upcoming weeks. Overall earnings are anticipated to witness a 3% improvement on 1.5% higher revenues, with four of the 16 Zacks sectors witnessing growth in the negative territory. The picture should become clearer by the end of this week after the majority releases results. For more details, you may go through our Earnings Preview report.
For companies operating in the renewable energy space, environmental considerations have been propelling demand for alternative sources of energy to a large extent. In fact, solar energy got a major boost from the environmental tax credit extensions of Dec 2015.
Further, the U.S. Energy Information Administration (“EIA”) anticipates total renewables used in the electric power sector to increase 9.5% in 2016 and 5.8% in 2017. The EIA also projects utility-scale solar generating capacity to increase from 10 gigawatts (“GW”) at the end of 2014 to 27 GW in 2017, which reflects an average annual growth rate of 39%, the highest for all sources of renewable electricity generation.
Two important solar stocks are expected to report third-quarter earnings on Nov 8.
Canadian Solar, Inc. (CSIQ - Free Report) posted a positive earnings surprise of 70.00% in the preceding quarter.
Our proven model does not conclusively show that Canadian Solar is likely to beat on earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) for this to happen. That is not the case here as you will see below. Please check our Earnings ESP Filter that enables you to find stocks that are expected to come out with earnings surprises.
The company has a Zacks Rank # 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
Canadian Solar has an Earnings ESP 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate stand at 25 cents. (Read more: Canadian Solar Q3 Earnings: Stock to Pull a Surprise?)
Vivint Solar, Inc. (VSLR - Free Report) is a provider of residential solar energy systems in the U.S. It designs, installs, and maintains cost-effective solar energy systems.
The company reported a positive earnings surprise of 15.52% in the prior quarter. It has a Zacks Rank # 3.
However, the company has an Earnings ESP of 0.00%. This is because both the Most Accurate estimate and the Zacks Consensus Estimate are pegged at a loss of 46 cents.
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