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Why Is Pattern Energy (PEGI) Up 19.4% Since Last Earnings Report?

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It has been about a month since the last earnings report for Pattern Energy (PEGI - Free Report) . Shares have added about 19.4% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Pattern Energy due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.

Pattern Energy Incurs Loss in Q2, Misses on Revenues

Pattern Energy Group reported a loss of 7 cents in second-quarter 2019 versus earnings of 34 cents per share in the year-ago quarter. The Zacks Consensus Estimate was pegged at earnings per share of 4 cents.

Total Revenues

Second-quarter revenues amounted to $140 million, which lagged the Zacks Consensus Estimate of $153 million by 8.5%. However, the total revenues were on par with the prior-year figure.

Quarterly Highlights

Pattern Energy sold 2,113,864 megawatt hours (MWh) of electricity on a proportional basis compared with 2,262,811 MWh in the year-ago quarter. The 7% decline was primarily caused by volume decreases attributed to divestitures in 2018 and unfavorable wind conditions.

Total operating expenses amounted to $15 million, reflecting a drop of 11.8% from the year-ago level.

The company incurred interest expenses of $25 million compared with $28 million in the year-ago quarter.

Financial Highlights

As of Jun 30, 2019, the company had cash and cash equivalents of $124 million compared with $101 million on Dec 31, 2018.

Its long-term debt was $2,084 million as of Jun 30, 2019, up from the Dec 31, 2018 level of $2,004 million.

The company’s cash flow from operating activities in the first half of 2019 was $75 million, down from $124 million recorded in the comparable year-ago quarter.

Guidance

Pattern Energy reaffirmed 2019 annual cash available for distribution in the range of $160-$190 million. The company also reaffirmed 2020 cash available for distribution in the band of $185-$225 million.
 

How Have Estimates Been Moving Since Then?

It turns out, estimates review flatlined during the past month. The consensus estimate has shifted 312.5% due to these changes.

VGM Scores

At this time, Pattern Energy has a poor Growth Score of F, however its Momentum Score is doing a lot better with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Pattern Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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