A month has gone by since the last earnings report for Ameren (AEE Quick QuoteAEE - Free Report) . Shares have added about 9.1% in that time frame, underperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Ameren 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.

Ameren Q1 Earnings Miss Estimates, Revenues Down Y/Y

Ameren Corporation’s first-quarter 2020 earnings of 59 cents per share from continuing operations lagged the Zacks Consensus Estimate of 71 cents by 16.9%. The bottom line also declined 24.4% from the year-ago quarter’s 78 cents.

Total Revenues

Total revenues came in at $1,440 million in the reported quarter, which declined 7.5% year over year due to lower electric sales and natural gas volumes. The top line also lagged the Zacks Consensus Estimate of $1,585 million by 9.1%.

Highlights of the Release

Ameren’s total electricity sales volume declined 2.8% to 18,671 million kilowatt hours (kWh) compared with 19,217 million kWh in the year-ago quarter. Moreover, gas volumes declined 12.2% to 72 million dekatherms.

Total operating expenses summed $1,199 million, down 5.4% year over year. Interest expenses were $93 million compared with $97 million a year ago.

The company’s operating income fell 16.3% to $241 million from $288 million in the year-ago quarter.

Segment Results

Ameren Missouri segment reported an operating loss of $10 million in the first quarter against a $39-million income in the year-ago quarter. The decline was primarily due to milder winter temperatures compared to colder-than-normal temperatures in the year-ago period as well as the absence of energy efficiency performance incentives compared to the year-ago period.

Ameren Illinois Electric Distribution segment reported operating income of $37 million in the first quarter compared with $36 million in the year-ago quarter, led by increased year-over-year earnings on infrastructure investments.

Ameren Illinois Natural Gas segment reported operating income of $55 million compared with $57 million in the year-ago quarter. The decline was primarily due to higher other operations and maintenance expenses incurred.

Ameren Transmission segment reported operating income of $47 million in the first quarter compared with $44 million in the year-ago quarter, led by increased earnings from infrastructure investments.

Financial Condition

The company reported cash and cash equivalents of $42 million as of Mar 31, 2020, compared with $16 million at 2019-end.

As of Mar 31, 2020, long-term debt totaled $9,378 million compared with $8,915 million as of Dec 31, 2019.

In the first quarter of 2020, cash from operating activities amounted to $290 million compared with $387 million in the first quarter of 2019.

Guidance

Ameren reaffirms its 2020 guidance. The company expects earnings of $3.40-$3.60 per share, which is projected to grow at a 6-8% compound annual rate from 2020 through 2024. Currently, the Zacks Consensus Estimate for the company’s 2020 earnings is pegged at $3.41 per share, lower than the midpoint of its guided range.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended upward during the past month.

VGM Scores

At this time, Ameren has an average Growth Score of C, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.

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

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Ameren has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.