What's In The Cards For Atlantic Power's (AT) Q2 Earnings?

Atlantic Power Corporation (TSX:AT) is scheduled to report second-quarter 2019 results on Aug 1, before the opening bell. The company came up with a positive earnings surprise of 250% in the last reported quarter.

Let’s see how things are shaping up before the next earnings announcement.

Factors to Consider

Atlantic Power has been utilizing its strong cash flow generating capability to redeem debts and repurchase shares. This is going to have a positive impact on earnings. In addition, the company’s long-term PPAs with customers lead to high earnings visibility.

The Zacks Consensus Estimate for the bottom line is pegged at 4 cents, which indicates year-over-year growth of 166.67%.

What Our Quantitative Model Predicts

Our proven model shows that Atlantic Power is unlikely to beat estimates in the to-be-reported quarter. A stock needs to have both a positive Earnings ESP (which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate) and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to surpass estimates. That is not the case here as you will see below.

Earnings ESP: The company’s Earnings ESP is 0.00%.

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

Zacks Rank: Currently, Atlantic Power has a Zacks Rank #2. The company’s favorable Zacks Rank, when combined with the 0.00% ESP, lowers the possibility of an earnings beat.

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.

Stocks to Consider

Investors may consider the following companies from the same industry that have the right combination of elements to beat estimates in the quarter to be reported:

Entergy Corporation (NYSE:ETR) is expected to release second-quarter results on Jul 31. It has an Earnings ESP of +1.4% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Southern Company (NYSE:SO) is set to release second-quarter results on Jul 31. It has an Earnings ESP of +0.46% and a Zacks Rank of 3.

Black Hills Corporation (NYSE:BKH) is scheduled to release second-quarter results on Aug 5. It has an Earnings ESP of +0.75% and a Zacks Rank of 3.

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