Back to top

Is a Beat in Store for FirstEnergy (FE) This Earnings Season?

Read MoreHide Full Article

FirstEnergy Corporation (FE - Free Report) is expected to report second-quarter 2018 earnings on Jul 26, before the market opens. The company is expected to come up with a positive earnings surprise in this quarter. This utility player reported positive earnings surprise in three of the last four quarters, the average being 3.56%.

What Does the Quantitative Model Predicts

Our proven model shows that FirstEnergy is likely to beat estimates because it has the right combination of two key ingredients. A stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to be able to beat estimates and the company has the right mix. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Earnings ESP is pegged at +0.47%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
 

FirstEnergy Corporation Price and EPS Surprise

 

FirstEnergy Corporation Price and EPS Surprise | FirstEnergy Corporation Quote


Zacks Rank: FirstEnergy carries a Zacks Rank #2. The combination of FirstEnergy’s favorable Zacks Rank and positive ESP makes us reasonably confident of a positive surprise this season.

Conversely, we caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is witnessing negative estimate revisions.

Factors at Play

For the second quarter of 2018, the company expects earnings per share in the range of 47-57 cents, while the Zacks Consensus Estimate for earnings is pegged at 53 cents. FirstEnergy is now a fully-regulated company and rate revision will help it recoup regular investments made on transmission and distribution lines to supply uninterrupted electricity to customers.

The company is expected to benefit from its modernization drive ‘Energizing the Future’. The plan is expected to create a stronger transmission system and improve service reliability. Modern technologies and strengthening of the infrastructure will provide quality services to existing customers and boost earnings.

Other Stocks to Consider

In addition to FirstEnergy, here are a few other players from the industry that have the right combination of elements to post an earnings beat this quarter.

Alliant Energy Corporation (LNT - Free Report) is expected to release second-quarter results on Aug 2. It has an Earnings ESP of +1.10% and a Zacks Rank #2.

CMS Energy Corporation (CMS - Free Report) is anticipated to release second-quarter results on Jul 26. It has an Earnings ESP of +11.26% and carries a Zacks Rank #2.

Dominion Energy Inc. (D - Free Report) is expected to release second-quarter results on Aug 1. It has an Earnings ESP of +7.17% and a Zacks Rank #2.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>



More from Zacks Analyst Blog

You May Like