Utility Stocks' Q1 Earnings Slated On Apr 27: D, POR, PNM

First-quarter 2018 earnings releases are flowing in and more than 30% or 154 S&P members (as of Apr 25, 2018) have already reported. The quarter is already showing positive trends, indicating that it will record the strongest earnings growth in seven years. Earnings for the reported S&P 500 members are up 25.4% from the same period last year, on 10.3% higher revenues, with 80.5% beating EPS estimates and 72.1% surpassing on revenues.

The reported earnings no doubt indicate another strong reporting cycle. Per our latest Earnings Trends, overall earnings in the first quarter for all the S&P 500 members are expected to be up 20.0% on 8.0% growth in revenues. For full-year 2018, total earnings for the S&P 500 index are expected to be up 18.3% on 5.4% higher revenues.

Let’s concentrate on the domestic-focused matured Utility sector. This sector, along with 15 other of the 16 Zacks sectors, is going to come up with a positive year-over-year earnings. Currently, only Autos sector is likely to register an earnings decline.

The Zacks Utility sector’s earnings are expected to increase 12.5% year over year on 0.4% growth in revenues, thanks to stable performance by most of the utilities. Utilities are expected to gain from tax reforms and cold weather conditions, driving the demand for electricity.

However, the rate-sensitive capital intensive utility stocks also had to accommodate to the Fed rate hike. The Fed rate has now been raised for the sixth time (latest on Mar 2018) since the first hike was announced in December 2015, when the U.S. economy had pulled itself out of the Great Recession.

Let’s take a look at the Utility stocks, scheduled to report first-quarter 2018 earnings on Apr 27, 2018 and see how things are shaping up for the upcoming results.

Dominion Energy Inc. (NYSE:D) reported positive earnings surprise of 3.41% in the last four quarters. The company’s earnings in the first quarter are expected to be adversely impacted by higher financing costs, share dilution and lower investment tax credits from solar investments. (Read more: What's in Store for Dominion Energy in Q1 Earnings?)

Dominion Energy has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell), which is not a favorable case for a positive earnings surprise this season. A stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) to beat estimates. You can see the complete list of today’s Zacks #1 Rank stocks here..

Portland General Electric Company (NYSE:GE) (NYSE:POR) reported positive earnings surprise in three out of the last four quarters, with an average surprise of 0.17%. This integrated electric company is involved in the generation, wholesale purchase, transmission, distribution and retail sale of electricity in the state of Oregon.

Portland General Electric Company has an Earnings ESP of +4.51% and a Zacks Rank #4, making earnings surprise prediction uncertain this season.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

PNM Resources, Inc. (NYSE:PNM) reported positive earnings surprise in the last four quarters with an average of 14.16%. This utility company along with its subsidiaries, Public Service Company of New Mexico and Texas-New Mexico Power Company is engaged in the generation, transmission and distribution of electricity.

PNM Resources has an Earnings ESP of -2.44% and sports a Zacks Rank #1, making earnings surprise prediction uncertain this season.

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