Xcel Energy (XEL) To Report Q4 Earnings: Is A Beat In Store?

Xcel Energy (NASDAQ:XEL) is expected to release fourth-quarter 2018 results on Jan 31, before market opens. The utility company reported negative earnings surprise of 2.04% in the last reported quarter.

What Does Our Quantitative Model Say?

Our proven model shows that Xcel Energy is likely to beat estimates in the upcoming quarterly results. A stock needs to have 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. You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings ESP: Earnings ESP is pegged at +0.39%.

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

Zacks Rank: Xcel Energy carries a Zacks Rank #3. The combination of Xcel Energy’s favorable Zacks Rank and a positive ESP makes us reasonably confident of a positive earnings surprise.

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

Factors in Play

In the first three quarters of 2018, Xcel Energy delivered earnings at the high-end of its initial guidance range. We expect the trend to continue in the fourth quarter as well. The company narrowed 2018 earnings per share guidance in the range of $2.45-$2.49, up from the previous range of $2.41-$2.51.

Xcel Energy is expected to benefit from a positive impact on demand and sales volume driven by ongoing increase in its electric and natural gas customer base.

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $2.86 billion, reflecting an increase of 2.39% year over year. The company is focused on renewable expansion. We expect a positive impact of steel for fuel investment strategies in the fourth quarter.

Other Stocks to Consider

Here are a few other players from the industry that have the right combination of elements to post an earnings beat this quarter.

Ameren Corp. (NYSE:AEE) has an Earnings ESP of +4.62% and a Zacks Rank #1. The company is scheduled to report fourth-quarter results on Feb 14.

FirstEnergy Corp. (NYSE:FE) has an Earnings ESP of +2.08% and a Zacks Rank #3. The company is expected to release fourth-quarter results on Feb 19.

CMS Energy (NYSE:CMS) has an Earnings ESP of +0.49% and a Zacks Rank #1. The company is scheduled to report third-quarter results on Jan 31.

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