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Why Is FirstEnergy (FE) Up 5.9% Since the Last Earnings Report?
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About a month has gone by since the last earnings report for FirstEnergy Corporation (FE - Free Report) . Shares have added about 5.9% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
FirstEnergy reported third-quarter 2017 operating earnings of 97 cents per share, beating the Zacks Consensus Estimate of 86 cents by 12.8%. Quarterly earnings were also up 7.7% year over year.
Moreover, third-quarter earnings exceeded the guidance of 75-90 cents provided by the company during second-quarter 2017.
On a GAAP basis, the diversified energy company reported earnings of 89 cents, in line with the prior-year quarter’s earnings.
Total Revenues
FirstEnergy generated total revenues of $3,714 million in third-quarter 2017, beating the Zacks Consensus Estimate of $3,640 million by 2.04%.
Reported revenues were down 5.5% from $3,917 million reported a year ago. The top line declined primarily due to lower contribution from Competitive Energy Services and Regulated distribution segments.
Highlights of the Release
Total electric sales decreased 2,899 thousand megawatt-hours (MWh) or 7% year over year. Residential sales declined 2,275 thousand MWh or 14.1%, while commercial sales fell 777 thousand MWh or 6.5%.
Industrial sales improved 150 thousand MWh or 1.2% primarily on account of higher usage by shale and steel customers.
For the third quarter, FirstEnergy incurred operating expenses of $2,781 million, down 9% from $3,056 million a year ago, primarily due to lower unit cost of fuel and cost of purchased power.
Operating income in the reported quarter was pegged at $835 million, up from $861 million in the prior-year quarter.
Financial Update
FirstEnergy's cash on hand as of Sep 30, was $399 million, up from $199 million as of Dec 31, 2016.
Long-term debt and other long-term obligations as of Sep 30, were $21,089 million compared with $18,192 million as of Dec 31, 2016.
Net cash provided from operating activities was $2,762 million during the first nine months of 2017 compared with $2,592 million in the first nine months of 2016.
Guidance
FirstEnergy has raised the operating earnings guidance for full-year 2017 to the range of $3.00-$3.10 per share from previous expectation of $2.70-$3.00.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision lower for the current quarter.
At this time, FirstEnergy's stock has a nice Growth Score of B, though it is lagging a bit on the momentum front with a C. The stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is equally suitable for value and growth investors.
Outlook
While estimates have been broadly trending downward for the stock, the magnitude of these revisions has been net zero. Notably, the stock has a Zacks Rank #3 (Hold). We expect in-line returns from the stock in the next few months.
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Why Is FirstEnergy (FE) Up 5.9% Since the Last Earnings Report?
About a month has gone by since the last earnings report for FirstEnergy Corporation (FE - Free Report) . Shares have added about 5.9% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
FirstEnergy Beats Q3 Earnings Estimates, Lifts '17 View
FirstEnergy reported third-quarter 2017 operating earnings of 97 cents per share, beating the Zacks Consensus Estimate of 86 cents by 12.8%. Quarterly earnings were also up 7.7% year over year.
Moreover, third-quarter earnings exceeded the guidance of 75-90 cents provided by the company during second-quarter 2017.
On a GAAP basis, the diversified energy company reported earnings of 89 cents, in line with the prior-year quarter’s earnings.
Total Revenues
FirstEnergy generated total revenues of $3,714 million in third-quarter 2017, beating the Zacks Consensus Estimate of $3,640 million by 2.04%.
Reported revenues were down 5.5% from $3,917 million reported a year ago. The top line declined primarily due to lower contribution from Competitive Energy Services and Regulated distribution segments.
Highlights of the Release
Total electric sales decreased 2,899 thousand megawatt-hours (MWh) or 7% year over year. Residential sales declined 2,275 thousand MWh or 14.1%, while commercial sales fell 777 thousand MWh or 6.5%.
Industrial sales improved 150 thousand MWh or 1.2% primarily on account of higher usage by shale and steel customers.
For the third quarter, FirstEnergy incurred operating expenses of $2,781 million, down 9% from $3,056 million a year ago, primarily due to lower unit cost of fuel and cost of purchased power.
Operating income in the reported quarter was pegged at $835 million, up from $861 million in the prior-year quarter.
Financial Update
FirstEnergy's cash on hand as of Sep 30, was $399 million, up from $199 million as of Dec 31, 2016.
Long-term debt and other long-term obligations as of Sep 30, were $21,089 million compared with $18,192 million as of Dec 31, 2016.
Net cash provided from operating activities was $2,762 million during the first nine months of 2017 compared with $2,592 million in the first nine months of 2016.
Guidance
FirstEnergy has raised the operating earnings guidance for full-year 2017 to the range of $3.00-$3.10 per share from previous expectation of $2.70-$3.00.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There has been one revision lower for the current quarter.
FirstEnergy Corporation Price and Consensus
FirstEnergy Corporation Price and Consensus | FirstEnergy Corporation Quote
VGM Scores
At this time, FirstEnergy's stock has a nice Growth Score of B, though it is lagging a bit on the momentum front with a C. The stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Based on our scores, the stock is equally suitable for value and growth investors.
Outlook
While estimates have been broadly trending downward for the stock, the magnitude of these revisions has been net zero. Notably, the stock has a Zacks Rank #3 (Hold). We expect in-line returns from the stock in the next few months.