Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Entergy (ETR) Q3 Earnings: Stock Likely To Beat Estimates?

Published 10/20/2016, 07:16 AM
Updated 07/09/2023, 06:31 AM

Entergy Corporation (NYSE:ETR) will release third-quarter 2016 financial numbers before the opening bell on Oct 25. The company reported a positive earnings surprise of 201.94% in the last reported quarter. Let’s see how things are shaping up prior to this announcement.

Why a Likely Positive Surprise?

Our proven model shows that Entergy is likely to beat earnings this season because it has the right combination of two key ingredients. A stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) to be able to beat estimates, and Entergy has the right mix.

Zacks ESP: The Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, stands at +8.07%. This is because the Most Accurate estimate stands at $2.01, while the Zacks Consensus Estimate is pegged slightly lower at $1.86. This is a meaningful indicator of a likely positive earnings surprise.

Zacks Rank: Entergy’s Zacks Rank #2, when combined with a positive ESP, makes us reasonably confident of an earnings beat this quarter.

Conversely, Sell-rated stocks (#4 or #5) should never be considered going into an earnings announcement, especially when the company is seeing negative estimate revisions.

ENTERGY CORP Price and EPS Surprise

ENTERGY CORP Price and EPS Surprise | ENTERGY CORP Quote

Factors at Play

Entergy plans to invest $3.77 billion in 2016, with the lion’s share being allocated for the generation and transmission businesses. The company expects grid upgrades, asset replacement, and industrial load growth to drive bottom-line growth.

The company's service territories witnessed above-average temperatures during the third quarter. This should lead to increased electric sales in these regions, which in turn, should boost the top line.

Other Stocks to Consider

Here are a few other operators in the electric utility space worth considering, as our model shows that they have the right combination of elements to post an earnings beat this quarter:

Pattern Energy Group Inc. (NASDAQ:PEGI) has an Earnings ESP of +16.67% and a Zacks Rank #2. The company is expected to release third-quarter results on Nov 3.

CMS Energy Corp. (NYSE:CMS) will report second-quarter results on Oct 27. The company has an Earnings ESP of +5.26% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

DTE Energy Company (NYSE:DTE) has an Earnings ESP of +4.64% and a Zacks Rank #2. The company will report second-quarter results on Oct 26.

Confidential from Zacks

Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>



CMS ENERGY (CMS): Free Stock Analysis Report

ENTERGY CORP (ETR): Free Stock Analysis Report

DTE ENERGY CO (DTE): Free Stock Analysis Report

PATTERN ENERGY (PEGI): Free Stock Analysis Report

Original post

Zacks Investment Research

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.