CenterPoint Energy, Inc. CNP is set to unveil its fourth-quarter and full-year 2023 results on Feb 20, before the market opens. The company has delivered a trailing four-quarter average earnings surprise of 1.35%.
Assessing the Driving Factors
Throughout the majority of the fourth quarter, CenterPoint Energy’s service territories grappled with a warmer-than-normal climate, with some regions experiencing record-breaking high temperatures in November. This unusual weather pattern is anticipated to have led to a surge in electricity demand for cooling purposes, potentially bolstering CenterPoint Energy’s top-line performance for the quarter under review.
Weather Impact and Operational Challenges
However, on the flip side, an adverse weather pattern, including multiple tornados and hailstorms, wreaked havoc across a substantial portion of CNP’s service territories during the same period. Consequently, these weather-related disruptions might have hindered the company’s services in those areas, exerting partial pressure on CNP’s overall revenues for the fourth quarter. The adverse weather conditions likely also led to increased restoration costs, consequently impacting CNP’s bottom-line performance.
Analyst Estimates and Projections
The Zacks Consensus Estimate for CenterPoint Energy’s fourth-quarter revenues stands at $2.76 billion, representing a 1.8% increase from the figure reported in the same period last year. Meanwhile, the company is expected to have earned 32 cents per share in the fourth quarter, marking a year-over-year improvement of 14.3%.
Insight from the Zacks Model
The potential of an earnings beat for CenterPoint Energy this time around is not conclusively predicted by our proven model. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) typically enhances the probability of an earnings beat. However, CenterPoint Energy’s Earnings ESP currently stands at -0.78% and the company carries a Zacks Rank #3 at present.
Exploring Alternate Options
With the fourth-quarter earnings season in full swing, it’s imperative to keep an eye on other utility stocks that might be primed for an earnings beat. Some notable mentions are Sempra Energy (SRE), Southwest Gas (SWX), and ONE Gas (OGS), each with their own unique merits and earnings potential during this reporting cycle.
Stay updated on upcoming earnings announcements through the Zacks Earnings Calendar.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
