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FirstEnergy (FE) Beats Earnings, Revenue Estimates in Q2

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FirstEnergy Corporation (FE - Free Report) reported second-quarter 2018 operating earnings of 62 cents per share, beating the Zacks Consensus Estimate of 53 cents by 17%. Quarterly earnings improved 40.9% year over year.

On a GAAP basis, the company reported earnings of 28 cents, excluding onetime settlement of 39 cents. The GAAP earnings improved 28.2% on a year-over-year basis.

Total Revenues

FirstEnergy generated total revenues of $2,704 million in second-quarter 2018, beating the Zacks Consensus Estimate of $2,563 million by 5.5%. The top line improved primarily on the back of favorable weather and successful customer-focused regulated growth initiatives. However, revenues declined 18.3% from $3,309 million in the year-ago quarter.

Highlights of the Release

Total electric delivery increased 4% year over year to 35,612 thousand megawatt-hours (MWh). Residential sales rose 8.6%, while commercial and industrial sales rose 1.6% and 2.0% year over year, respectively.

Due to higher weather-related usage, distribution services revenues increased by $33 million from the year-ago quarter’s figure.

FirstEnergy Corporation Price, Consensus and EPS Surprise

Financial Update

FirstEnergy's cash and cash equivalents as of Jun 30, 2018 were $256 million, down from $588 million as of Dec 31, 2017.

Long-term debt and other long-term obligations as of Jun 30 were $16,461 million compared with $18,186 million as of Dec 31, 2017.

Net cash provided from operating activities was $592 million in the quarter under review, compared with $697 million provided in the second quarter of 2017.

Guidance

FirstEnergy updated 2018 GAAP earnings in the range of $3.74-$4.04 per share. The company reaffirmed full-year operating non-GAAP earnings guidance in the range of $2.25-$2.55. For the third quarter of 2018, non-GAAP earnings are estimated in the range of 65-75 cents.

Utility Releases

DTE Energy (DTE - Free Report) reported second-quarter 2018 operating earnings per share of $1.36, which outpaced the Zacks Consensus Estimate of $1.11 by 22.5%.

American Electric Power (AEP - Free Report) reported second-quarter 2018 adjusted earnings per share (EPS) of $1.01, beating the Zacks Consensus Estimate of 88 cents per share by 14.8%.

NextEra Energy (NEE - Free Report) reported second-quarter 2018 adjusted earnings of $2.11 per share, beating the Zacks Consensus Estimate of $2.07 by 1.93%

Zacks Rank

FirstEnergy has 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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