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Public Service Enterprise (PEG) Tops Q1 Earnings, Keeps View

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Public Service Enterprise Group Inc. (PEG - Free Report) or PSEG reported first-quarter 2017 adjusted operating earnings of 92 cents per share, which exceeded the Zacks Consensus Estimate of 84 cents by 9.5%. Earnings also improved 1.1% on a year-over-year basis.

Excluding one–time adjustments, the company reported quarterly earnings of 22 cents per share, compared with 93 cents in the first-quarter 2016.

Total Revenue

Revenues of $2,592 million in the reported quarter surpassed the Zacks Consensus Estimate of $2,564 million by 1.1%. However, the figure fell 0.9% from the year-ago figure of $2,616 million.

During the reported quarter, electric sales volume increased 1.6% to 9,889 million kilowatt-hours. But gas sales volume declined 3.5% to 1,444 million therms.

For electric sales, results reflected a 2.4% rise in the commercial and industrial sector and 4.6% growth in street lighting. However, sales volume of residential sector and interdepartmental sector dropped 0.1% and 1%, respectively.

Total gas sales volume in the reported quarter declined on 20.1% drop in non-firm sales volume of gas, despite a 2.9% improvement in firm sales volume of gas.

Highlights of the Release

During the first quarter, the company incurred operating loss of $178 million down from $827 million in the year-ago quarter. Total operating expenses were $2,414 million, up 34.9% from the year-ago quarter figure.

Interest expenses in the reported quarter were $98 million, up 6.5% from the year-ago level.

Segment Performance

PSE&G: Segment earnings were $299 million, up from $262 million in the prior-year quarter. Quarterly results reflect the continuing successful execution of its growth initiatives and control of operating expenses.

PSEG Power: The segment suffered a loss of $170 million against earnings of $192 million a year ago. The downside was due to the impact of incremental depreciation and other expenses of $564 million pre-tax associated with the decision to retire the Hudson and Mercer coal/gas-fired generating stations announced on Jun 1, 2017.

PSEG Enterprise/Other: The segment generated net loss of $15 million as against operating earnings of $17 million in the first quarter of 2016.

Financial Update

As of Mar 31, 2017, cash and cash equivalents were $193 million compared with $423 million as of Dec 31, 2016.

Long-term debt as of Mar 31, 2017 was $11,398 million, up from the 2016-end level of $11,395 million.

Public Service Enterprise Group generated $1,196 million in cash from operations in the first quarter, up from the year-ago figure of $1,214.

2017 Guidance

The company maintained its 2017 guidance. Earnings are still projected in the range of $2.80–$3.00.

PSE&G’s operating earnings are still expected in the band of $945–$985 million. The company also reiterates PSEG Power operating earnings guidance in the $435–$510 million range.

PSEG Enterprise/Other’s operating earnings expectations are reaffirmed at $35 million.

Other Utility Releases

DTE Energy Company (DTE - Free Report) reported first-quarter 2017 operating earnings per share of $1.79, which surpassed the Zacks Consensus Estimate of $1.57 by 14%. Total revenue came in at $3.24 billion, which surpassed the Zacks Consensus Estimate of $2.58 billion by 25.6%.

Entergy Corporation (ETR - Free Report) reported first-quarter 2017 operational earnings of 99 cents per share, lagging the Zacks Consensus Estimate of $1.06 by 6.6%. It reported total revenue of $2,588.5 million, beating the Zacks Consensus Estimate of $2,566 million by 0.9%.

NextEra Energy, Inc. (NEE - Free Report) reported first-quarter 2017 adjusted earnings of $1.75 per share, beating the Zacks Consensus Estimate of $1.56 by 12.2%. Operating revenues totaled $3,972 million that surpassed the Zacks Consensus Estimate of $3,943 million by nearly 0.7%.

Zacks Rank

Public Service Enterprise Group currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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