A month has gone by since the last earnings report for Dominion Energy (D - Free Report) . Shares have added about 0.7% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Dominion 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.
Dominion Beats Q3 Earnings Estimates, Tightens View
Dominion Energy Inc. reported third-quarter 2019 operating earnings of $1.18 per share, beating the Zacks Consensus Estimate of $1.16 by 1.7%. Operating earnings came near the upper end of the company’s guided range of $1.00-$1.20 per share. Strong contribution from business units and favorable weather aided the company to improve from the year-ago earnings of $1.15.
GAAP earnings were $1.17 per share compared with $1.30 in the year-ago quarter.
Dominion’s total revenues came in at $4,269 million, lagging the Zacks Consensus Estimate of $4,414 million by 3.3% but improving 23.7% from $3,451 million in the year-ago quarter.
Highlights of the Release
Total operating expenses increased 28.4% year over year to $2,955 million due to higher electric fuel and purchase gas prices, and an increase in operating and maintenance costs.
Interest and related charges in the reported quarter were $451 million, up 19.3% from the year-ago period.
In the reported quarter, the electric delivery customer base increased by 768,806 from the prior-year level. Electricity delivery volumes also improved 29.9% year over year to 31,193 gigawatt hours in the third quarter.
Power Delivery: Net income from this segment was $185 million, up 13.5% year over year.
Power Generation: The segment’s net income was $490 million, increasing 18.4% year over year.
Gas Infrastructure: Net income from this segment was $232 million, down 12.1% on a year-over-year basis.
Southeast Energy: Net income from this segment was $147 million.
Corporate and Other: The segment’s net loss was $87 million compared with a loss of $83 million in the year-ago quarter.
Cash, restricted cash and cash equivalents as of Sep 30, 2019 were $378 million compared with $268 million on Dec 31, 2018.
Long-term debt as of Sep 30, 2019 was $29.83 billion compared with $26.32 billion at the end of 2018.
Cash from operating activities in the first nine months of 2019 was $3.7 billion compared with $3.71 billion in the same period last year.
For fourth-quarter 2019, Dominion expects operating earnings within $1.10-$1.25 per share. The company had reported earnings of 89 cents per share in the year-ago period. The midpoint of the above guided range is $1.175, below the current Zacks Consensus Estimate for the period of $1.09.
For 2019, Dominion narrowed its earnings guidance to the range of $4.15-$4.30 per share from the earlier projection of $4.05-$4.40. The company had recorded earnings of $4.05 per share in 2018. The midpoint of the above guided range is $4.225, higher than the current Zacks Consensus Estimate for the period of $4.15.
How Have Estimates Been Moving Since Then?
It turns out, estimates revision have trended downward during the past month.
Currently, Dominion Energy has a subpar Growth Score of D, 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 D. If you aren't focused on one strategy, this score is the one you should be interested in.
Estimates have been broadly trending downward for the stock, and the magnitude of this revision has been net zero. Notably, Dominion Energy has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.