Algonquin Power (AQN) Q3 Earnings: What's In The Cards?

Algonquin Power & Utilities Corp. (TO:AQN) is set to report third-quarter 2018 results on Nov 8, after the market closes.

In the last reported quarter, the company came up with a positive earnings surprise of 22.22%. Moreover, its bottom line surpassed the Zacks Consensus Estimate in all the trailing four quarters, the average being 36.39%.

Let’s see how things are shaping up at the company prior to this announcement.

Algonquin Power & Utilities Corp. Price and EPS Surprise

Factors in Play

Algonquin Power continues to expand its renewable power generation portfolio in the second quarter of 2018, the company’s 75 megawatt (MW) of Amherst Island wind project started commercial operation. These factors are expected to drive the company’s performance in the quarter to be reported.

The company’s joint venture, AAGES, with Spain-based Abengoa S.A. will support its goal to broaden its international business activities. Its strategy to expand its global business operations will provide a further cushion to revenue and margin expansion in the to-be-reported quarter.

The Zacks Consensus Estimate for total revenues in the third quarter is pegged at $353.5 million, in line with the year-ago figure. The consensus mark for earnings in the same period stands at 10 cents per share, representing a downward trend of 23.1% from the year-ago period’s number.

Earnings Whispers

Our proven model does not conclusively show that Algonquin Power is likely to beat estimates in the upcoming quarterly release. This is because a stock needs to have both a positive Earnings ESP and a favorable Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) for this to happen. But that is not the case here as you will see below.

Earnings ESP: Algonquin Power has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Algonquin Power has a Zacks Rank #3, which increases the predictive power of ESP. However, the company’s 0.00% ESP makes surprise prediction incomplete.

We caution against Sell-rated stocks (#4 or 5) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Stocks That Warrant a Look

Here are a few stocks in the Utility – Electric Power space that you may want to consider as our model shows that these have the right combination of elements to beat on earnings in the upcoming releases:

The Southern Company (NYSE:SO) has an Earnings ESP of +0.37% and is a Zacks #1 Ranked stock. The company is anticipated to report third-quarter 2018 earnings on Nov 7. You can see the complete list of today’s Zacks #1 Rank stocks here.

The AES Corporation (NYSE:AES) has an Earnings ESP of +1.43% and a Zacks Rank #2. It is slated to report third-quarter 2018 earnings on Nov 6.

PNM Resources, Inc. (NYSE:PNM) has an Earnings ESP of +1.21% and a Zacks Rank of 2. It is expected to report third-quarter 2018 earnings on Nov 6.

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