Duke Energy (DUK) To Post Q4 Earnings: What's In The Card?

Duke Energy Corporation (NYSE:DUK) is set to report fourth-quarter 2018 results on Feb 14, before the opening bell.

In the last reported quarter, the company delivered a positive earnings surprise of 7.84%. Moreover, earnings surpassed the Zacks Consensus Estimate in three of the past four quarters, the average beat being 3.18%.

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

Factors under Consideration

During the fourth quarter, hurricanes and thunderstorms led to widespread devastation in certain parts of Florida, Kentucky and the Carolinas. This may have led to prolonged power outages leading to disruption in smooth power supply.

In December, the company forecasted an approaching winter storm that could result in approximately 500,000 power outages or more for homes and businesses in the Carolinas.

As a result, temperature is most likely to reflect an unfavorable impact on Duke Energy’s revenues in the to-be-reported quarter. In line with this, the Zacks Consensus Estimate for Duke Energy’s fourth-quarter revenues is anticipated to decline 4.1% year over year to $5.61 billion.

From the bottom-line perspective, Hurricane Michael is expected to have an unfavorable impact on Duke Energy’s Electric Utilities and Infrastructure business segments. The company now is anticipated to experience higher operations and maintenance (O&M) costs led by the storm, apart from other infrastructural damages and losses. Per company officials, the preliminary O&M cost estimates for Hurricane Michael will approximately be around $200 million.

In line with this, the Zacks Consensus Estimate for Duke Energy’s fourth-quarter earnings pegged at 89 cents reflects an annual decline of 5.3%.

What the Zacks Model Unveils

Our proven model does not conclusively show that Duke Energy is likely to beat estimates in the fourth quarter. This is because a stock needs to have both — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — for this to happen.

Earnings ESP: Duke Energy has an Earnings ESP of -2.26%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Duke Energy has a Zacks Rank #3.

Please note that we caution against stocks with a Zacks Rank #4 or 5 (Sell rated) going into the earnings announcement, especially when the company is seeing negative estimate revisions.

Duke Energy Corporation Price and EPS Surprise