A month has gone by since the last earnings report for Xcel Energy (XEL). Shares have lost about 9.4% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Xcel due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Xcel Energy Q4 Earnings Beat Estimates, Revenues Miss
Xcel Energy posted fourth-quarter 2019 operating earnings of 56 cents per share, which beat the Zacks Consensus Estimate of 53 cents by 5.6%.
For 2019, the company reported earnings of $2.64, up 6.8% from $2.47 in 2018.
The upside can be attributed to higher electric margins, courtesy of favorable non-fuel riders and regulatory rate outcomes as well as natural gas margins and lower O&M expenses. However, these factors were partially offset by lower AFUDC, increased depreciation and interest expenses.
Total Revenues
Xcel Energy’s fourth-quarter revenues of $2,798 million missed the Zacks Consensus Estimate of $3,178 million by 11.9%. Revenues fell 2.8% from the prior-year quarter’s tally of $2,880 million.
Xcel Energy’s total operating revenues for 2019 was $11,529 million, down 0.06% from $11,537 million in 2018.
Segment Results
Electric: Revenues declined 3% to $2,231 million from $2,300 million in the last reported quarter.
Natural Gas: Revenues fell 2.5% to $544 million from the year-ago quarter’s tally.
Other: Revenues in the segment amounted to $23 million in the quarter, up by a penny from the year-ago quarter’s figure.
Quarterly Highlights
Total operating expenses fell 7.6% year over year to $2,348 million.
Operating income in the reported quarter increased 32.7% from the prior-year quarter’s tally to $450 million.
Total interest charges and financing costs in the reported quarter rose 13.5% from the prior-year quarter’s figure to $185 million.
Looking Ahead
Xcel Energy reaffirmed 2020 earnings per share guidance in the range of $2.73-$2.83 and long-term earnings growth in the band of 5-7% from a 2019 base of $2.60 (mid-point of the original 2019 guidance range) per share. The mid-point of the current earnings guidance range is $2.78, which is in line with the Zacks Consensus Estimate for 2020 earnings.
Xcel Energy projects an annual increase in dividend rate in the range of 5-7%.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last two month period as none of them issued any earnings estimate revisions.
VGM Scores
Currently, Xcel has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, 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
Xcel has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
Xcel Energy Inc. (NASDAQ:XEL
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