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Xcel Energy (NasdaqGS:XEL) Q3 Earnings: What Can You Expect?

in EARNINGS/INVESTING IDEAS by

Xcel Energy Inc. (NasdaqGS:XEL) is scheduled to report Q3 earnings results before markets open for trading on October 29, 2020.

The company is expected to report earnings of $1.06/share on revenue of $3.367 billion. The consensus earnings per share (EPS) of $1.06/share is based on a poll of 14 analysts and represents a growth in eps of 4.5% over the same quarter last year, when the company reported earnings of $1.01/share.

The revenue forecast of $3.367 billion based on a poll of 5 analysts implies a year-over-year (YoY) growth in revenue of 11.8%. Last year the company reported $3.013 billion in revenue for the quarter.

Expected to report EPS growth of 4.5% for Q3, 2020
Metric Expected Prior Year YoY Change
Revenue $3,367.07 $3,013.00 11.8%
EPS $1.06 $1.01 4.5%

Earnings Call Trends

Historically, management has exceeded analyst expectations 3 out of the last 8 tracked quarters, missed 4 quarters, and met expectations 1 quarter.

What are your expectations from Xcel Energy Inc. for earnings this quarter? Let us know in the comments!

Analyst Expected vs. Reported EPS
Quarter Expected Reported Surprise Result
Q2, 2020 $0.49 $0.54 10.5% Beat
Q1, 2020 $0.59 $0.56 −5.2% Missed
Q4, 2019 $0.54 $0.56 3.4% Beat
Q3, 2019 $1.03 $1.01 −1.8% Missed
Q2, 2019 $0.53 $0.46 −12.4% Missed
Q1, 2019 $0.61 $0.61 0.0% Met
Q4, 2018 $0.41 $0.42 1.4% Beat
Q3, 2018 $0.98 $0.96 −2.0% Missed

In the following table, we summarize the company’s stock price movements after earnings releases. The “Price Day Prior” column shows the closing stock price on the day before the earnings report, and the “Price Next Day” column shows the stock price at the end of the trading day after the earnings report. After the last earnings report for the period ending June 30, 2020, the stock price did not react much to the update.

Stock Price Performance After Earnings
Report Date Price Day Prior Price Next Day Change % Result
July 30, 2020 $68.73 $69.04 0.5% Increase
May 7, 2020 $61.22 $60.31 −1.5% Decline
January 30, 2020 $67.42 $69.19 2.6% Increase
October 24, 2019 $64.44 $63.64 −1.2% Decline

The other question to consider is one of earnings manipulation. There is a lot of pressure on management each quarter to deliver on earnings expectations. The Beneish M-Score is a statistical model that provides some insight into whether the company might be manipulating earnings. With a Beneish M-Score of −2.62, the model suggests that the company is not likely to be an earnings manipulator. A value of −2.62 implies a 0.4% chance of earnings manipulation.

Fundamentals And Technical Analysis

Xcel Energy Inc. is currently trading at $71.69/share, up 0.3% for the day. The company is trading at approximately 96.3% of its 52-week high of $74.41/share. The company’s stock price is up 3.8% since the last earnings report and up 0.2% over the previous week. The company’s 14 Day Relative Price Index (RSI) of 53.75 suggests the company is trading in technically neutral territory. The RSI is considered overbought when above 70 and oversold when below 30.


NasdaqGS:XEL Stock Price Chart
Source: Finbox

The current share price implies a price-to-earnings (P/E) multiple of 26.88 and a forward P/E multiple of 25.54.

Xcel Energy Inc.’s current share price also implies a price-to-book (P/B) multiple of 2.81. The following table summarizes some other key fundamental ratios:

Data as of October 27, 2020
Metric Value
Last Reported Fiscal Period Key FY2020.Q2
Period End Date June 30, 2020
Stock Price (Current) $71.69
P/E Ratio 26.9x
P/E Ratio (Fwd) 25.5x
PEG Ratio 3.0
Total Debt / Total Capital 38.2%
Levered Free Cash Flow -$2.028 billion
EV / EBITDA 15.3x

Finbox

Xcel Energy Inc. is a large-cap stock with a market capitalization of $37.662 billion and a total enterprise value of $59.267 billion. The company operates in the Utilities sector and the Electric Utilities industry.

Xcel Energy Inc., through its subsidiaries, generates, purchases, transmits, distributes, and sells electricity. It operates through Regulated Electric Utility, Regulated Natural Gas Utility, and All Other segments. The company generates electricity through coal, nuclear, natural gas, hydroelectric, solar, biomass, oil, wood/refuse, and wind energy sources. It also purchases, transports, distributes, and sells natural gas to retail customers, as well as transports customer-owned natural gas. In addition, the company develops and leases natural gas pipelines, and storage and compression facilities; and invests in rental housing projects, as well as procures equipment for construction of renewable generation facilities. It serves residential, commercial, and industrial customers in the portions of Colorado, Michigan, Minnesota, New Mexico, North Dakota, South Dakota, Texas, and Wisconsin. The company sells electricity to approximately 3.7 million customers; and natural gas to approximately 2.1 million customers. Xcel Energy Inc. was founded in 1909 and is headquartered in Minneapolis, Minnesota.

Expertise: financial technology, analyzing market trends. Brian is a founder at finbox.io, where he’s focused on building tools that make it faster and easier for investors to research stock fundamentals. Brian’s background is in physics & computer science and previously worked as a software engineer at GE Healthcare. He enjoys applying his expertise in technology to help find market trends that impact investors. Brian can be reached at brian@finbox.io or at +1 (516) 778-6257.

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