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What Awaits Public Service Enterprise (PEG) in Q4 Earnings?

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Public Service Enterprise Group Incorporated (PEG - Free Report) , better known as PSEG, is scheduled to report fourth-quarter 2021 results on Feb 24, before the opening bell.

In the last-reported quarter, the company delivered an earnings surprise of 6.52%. PSEG has a trailing four-quarter negative earnings surprise of 4.57%, on average.

Factors to Note

While at the onset of the October-December quarter, Public Service Enterprise’s service territory areas usually witness warm temperatures, in the back half, it witnesses a cold temperature pattern. However, during major parts of the fourth quarter of 2021, the company’s operational regions experienced warmer-than-normal temperatures across the board. So, the overall impact of weather patterns must have had a moderate impact on the company’s top-line performance in the to-be-reported quarter.

Meanwhile, with the economy gradually recovering from the initial adverse effects of the pandemic, PSEG is projected to have witnessed an uptick in electricity demand from commercial and industrial space. This is likely to have favored the to-be-reported quarter's performance.

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $2.50 billion, suggesting growth of 4% from the year-ago quarter.

The various capital investment programs initiated by the company in the prior quarters as well as favorable rate settlement implemented at PSE&G in August 2021 must have boosted PSEG’s earnings performance in the quarter to be reported. However, for a few days within the fourth quarter, PSEG’s service territories suffered from flash flooding accompanied by strong wind gusts, which brought in power outages for its customers and might have damaged the company’s infrastructure. Costs related to the restoration of such power outages as well as mending of its infrastructural damage might have partially weighed on the fourth-quarter bottom line.

The Zacks Consensus Estimate for fourth-quarter earnings is pegged at 68 cents per share, indicating an improvement of 4.6% from the prior-year reported figure.

What the Zacks Model Unveils

Our proven model predicts an earnings beat for PSEG this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat.
 
Earnings ESP: The company’s Earnings ESP is +0.37%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: PSEG currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Other Stocks to Consider

Here are three Utilities players you may want to consider, as these also have the right combination of elements to post an earnings beat this season:

American Electric Power (AEP - Free Report) has an Earnings ESP of +0.43% and a Zacks Rank #3. The stock boasts a long-term earnings growth rate of 5.60%.

The Zacks Consensus Estimate for American Electric’s fourth-quarter revenues and earnings is pegged at $4.02 billion and 94 cents, respectively. AEP has a four-quarter average earnings surprise of 1.61%.

ONEOK (OKE - Free Report) has an Earnings ESP of +0.97% and a Zacks Rank #3. The stock boasts a long-term earnings growth rate of 7.90%.

The Zacks Consensus Estimate for ONEOK’s fourth-quarter revenues and earnings is pegged at $6.49 billion and 88 cents, respectively. OKE has a four-quarter average earnings surprise of 2.36%.

Sempra Energy (SRE - Free Report) has an Earnings ESP of +0.58% and a Zacks Rank #3. The stock boasts a long-term earnings growth rate of 5.3%.

The Zacks Consensus Estimate for Sempra Energy’s fourth-quarter revenues and earnings is pegged at $3.31 billion and $2.02, respectively. SRE has a four-quarter average earnings surprise of 7.90%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.
 

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