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Xcel (XEL) Up 5.7% Since Last Earnings Report: Can It Continue?

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It has been about a month since the last earnings report for Xcel Energy (XEL - Free Report) . Shares have added about 5.7% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Xcel due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.

Xcel Energy's Q2 Earnings & Revenues Miss Estimates

Xcel Energy posted second-quarter 2019 operating earnings of 46 cents per share, which lagged the Zacks Consensus Estimate of 53 cents by 13.21%.

Second quarter earnings gained from higher electric and natural gas margins courtesy of non-fuel riders and regulatory rate outcomes. However, these factors were offset by.

Total Revenues

Xcel Energy’s second-quarter revenues amounted to $2,577 million, which missed the Zacks Consensus Estimate of $2,778 million by 7.22%. The figure also declined 3% from the prior-year quarter’s tally of $2,658 million. Lower Electric revenues hurt the quarterly outcome.

Segment Results

Electric: Revenues declined 4.2% to $2,249 million from $2,348 million in the last reported quarter.

Natural Gas: Revenues improved 5.5% to $308 million from the year-ago quarter’s tally.

Other: Revenues in the segment amounted to $20 million in the quarter, up 11.1% from the year-ago quarter’s figure.

Quarterly Highlights

Total operating expenses dipped 1.8% year over year to $2,167 million.

Operating income in the reported quarter fell 8.9% from the prior-year quarter’s tally to $410 million.

Total interest charges and financing costs in the reported quarter rose 9.1% from the prior-year quarter’s figure to $179 million.

Outlook

Xcel Energy reaffirmed 2019 earnings per share guidance in the range of $2.55-$2.65 and long-term earnings growth in the band of 5-7% from a base of $2.43 (mid-point of the original 2018 guidance range) per share.

Xcel Energy projects an annual increase in dividend rate by 5-7%
 

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed an upward trend in estimates review.

VGM Scores

At this time, Xcel has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been trending upward for the stock, and the magnitude of this revision looks promising. Notably, Xcel has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.


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