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Public Service Enterprise (PEG) Q3 Earnings Beat Estimates

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Public Service Enterprise Group Inc. (PEG - Free Report) , or PSEG, reported third-quarter 2019 adjusted operating earnings of 98 cents per share, which surpassed the Zacks Consensus Estimate of 95 cents by 3.2%. The bottom line also improved 3.2% on a year-over-year basis.

Excluding one-time adjustments, the company reported quarterly earnings of 79 cents per share compared with 81 cents in third-quarter 2018.

Total Revenues

Revenue of $2,302 million in the quarter missed the Zacks Consensus Estimate of $2,551 million by 9.8%. Moreover, the figure declined 3.8% from the year-ago quarter’s $2,394 million.

Electric sales volumes rose 3% year over year to 12,124 million kilowatt-hours, while gas sales volumes grew 6% year over year to 609 million therms.

Under Electric sales, Residential sales volumes were 4,590 million kilowatt-hours, whereas Commercial and Industrial sales volumes accounted for 7,461 million kilowatt-hours. Other sales accounted for 73 million kilowatt-hours.

Total gas sales volumes witnessed 10% growth in non-firm sales volumes of gas and 6% a decline in firm sales volumes of gas.

Highlights of the Release

During the third quarter of 2019, the company reported operating income of $490 million, down from $554 million in the year-ago quarter. Total operating expenses were $1,812 million, down 1.5% from the year- ago quarter.

Interest expenses in the reported quarter were $147 million compared with $127 million in the year-ago quarter.

Segment Performance

PSE&G: Segment earnings were $344 million, up from $278 million in the prior-year quarter. PSE&G’s results in the quarter were driven by enhanced investments in transmission and distribution programs, rate relief, and changes to pension plans.

PSEG Power: Segment earnings were $53 million, down from $125 million in the prior-year quarter. The downside was led by lower realized energy prices and reduced capacity revenues.

PSEG Enterprise/Other: Segment earnings were $6 million, down from $9 million in the prior-year quarter. The year-over-year decrease in Net Income reflects higher interest expenses at the parent company.

Public Service Enterprise Group Incorporated Price, Consensus and EPS Surprise

Financial Update

Long-term debt as of Sep 30, 2019, was $15,504 million, up from the 2018-end level of $14,462 million.

PSEG generated $2,709 million in cash from operations at the end of the first nine months of 2019 compared to $2,492 million in the same period last year.

2019 Guidance

The company narrowed its 2019 guidance. Adjusted earnings are projected to be $3.20-$3.30 per share. The Zacks Consensus Estimate for earnings is currently pegged at $3.24, slightly lower than the mid-point of the company’s guided range.

PSE&G’s operating earnings are anticipated to be $1,225-$1,250 million. The company expects PSEG Power operating earnings to be $395-$420 million.

Zacks Rank

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

Recent Utility Releases

NextEra Energy (NEE - Free Report) reported third-quarter 2019 adjusted earnings of $2.39 per share, beating the Zacks Consensus Estimate of $2.27 by 5.3%. Moreover, the reported earnings rose 10.1% on a year-over-year basis.

Entergy Corporation (ETR - Free Report) reported third-quarter 2019 adjusted earnings of $2.52 per share, which surpassed the Zacks Consensus Estimate of $2.31 by 9.1%. Moreover, the reported figure rose 7.2% from $2.35 per share in the year-ago quarter.

An Upcoming Release

Dominion Energy (D - Free Report) is scheduled to report third-quarter 2019 results on Nov 1. The Zacks Consensus Estimate for earnings is pegged at 89 cents per share.

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