雅虎香港財經 PPL (PPL) Up 2.3% Since Last Earnings Report: Can It Continue?
A month has gone by since the last earnings report for PPL (PPL). Shares have added about 2.3% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is PPL due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
PPL's Q1 Earnings Beat Estimates on Strong Electricity Sales
PPL Corporation reported first-quarter 2024 operating earnings per share (EPS) of 54 cents, which surpassed the Zacks Consensus Estimate of 52 cents by 3.8%. The bottom line increased 12.5% from the year-ago quarter’s figure of 48 cents.
On a GAAP basis, PPL recorded EPS of 42 cents compared with 39 cents in the year-ago quarter. The difference between GAAP and operating earnings was due one-time items like 11 cents expenses relating to acquisition integration and 1 cent cost relating to PPL Electric billing issue.
Revenues
Total revenues of $2.3 billion missed the Zacks Consensus Estimate of $2.43 billion by 5.3%. The top line declined 4.6% from the year-ago quarter’s figure of $2.4 billion.
Highlights of the Release
Total operating expenses were $1.76 billion, down 8.3% from the year-ago quarter’s $1.92 billion. This decrease was due to a fall in energy purchase expenses and taxes other than income tax.
The operating income totaled $545 million, up 9.4% from the year-ago quarter’s figure of $498 million.
Interest expense was $179 million, up 9.1% from $164 million in first-quarter 2023.
Segmental Updates
Pennsylvania Regulated: Adjusted EPS was 25 cents, up 13.6% from the year-ago quarter’s figure of 22 cents. This unit recorded total electricity sales of 9,627 gigawatt-hour (GWh), up 2% year over year.
Kentucky Regulated: Adjusted EPS was 22 cents, up 15.8% from the year-ago quarter’s level of 19 cents. This segment recorded total electricity sales of 7,621 GWh, up 7.6% year over year.
Rhode Island Regulated: Adjusted EPS was 11 cents per share, up 10% year over year.
Corporate and Other: The segment incurred a loss of 4 cents per share compared with 3 cents in the year-ago quarter.
Financial Position
As of Mar 31, 2024, PPL had cash and cash equivalents of $276 million compared with $331 million as of Dec 31, 2023.
The long-term debt was $15.8 billion as of Mar 31, 2024, compared with $14.6 billion as of Dec 31, 2023.
Net cash provided by operating activities in the first three months of 2024 was $282 million compared with $430 million in the year-ago period.
Guidance
PPL reiterated its 2024 EPS guidance of $1.63-$1.75. The Zacks Consensus Estimate is pegged at $1.70, which is a tad higher than the midpoint of the company’s guided range. PPL reaffirmed long-term annual earnings growth rate in the range of 6-8% through 2027.
The company restated its capital expenditure of $14.3 billion for 2024 to 2027. PPL plans to invest $3 billion in 2024 to strengthen its infrastructure.
Management expects O&M savings of at least $175 million by 2026. It is on track to deliver O&M savings in the range of $120-$130 million by the end of 2024.
How Have Estimates Been Moving Since Then?
It turns out, estimates review flatlined during the past month.
VGM Scores
At this time, PPL has an average Growth Score of C, a grade with the same score on the momentum front. Following the exact same course, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
PPL has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
Performance of an Industry Player
PPL is part of the Zacks Utility - Electric Power industry. Over the past month, Entergy (ETR), a stock from the same industry, has gained 0.6%. The company reported its results for the quarter ended March 2024 more than a month ago.
Entergy reported revenues of $2.79 billion in the last reported quarter, representing a year-over-year change of -6.3%. EPS of $1.08 for the same period compares with $1.14 a year ago.
For the current quarter, Entergy is expected to post earnings of $2.07 per share, indicating a change of +12.5% from the year-ago quarter. The Zacks Consensus Estimate has changed +1.5% over the last 30 days.
The overall direction and magnitude of estimate revisions translate into a Zacks Rank #3 (Hold) for Entergy. Also, the stock has a VGM Score of B.
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