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Why Is Exelon (EXC) Down 1.4% Since Last Earnings Report?

A month has gone by since the last earnings report for Exelon (EXC). Shares have lost about 1.4% in that time frame, outperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Exelon due for a breakout? 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.

Exelon Q2 Earnings Lag Estimates, Revenues Surpass

Exelon Corporation’s second-quarter 2022 earnings of 44 cents per share lagged the Zacks Consensus Estimate of 46 cents by 4.3%.

On a GAAP basis, second-quarter earnings were 47 cents per share compared with 33 cents in the year-ago quarter. The difference in GAAP and operating earnings per share was due to separation costs and income-tax-related adjustments.

Total Revenues

Exelon's second-quarter total revenues of $4.23 billion surpassed the Zacks Consensus Estimate of $4.12 billion by 2.8%. The top line improved 0.7% from the year-ago figure of $4.2 billion.

Highlights of the Release

Exelon's second-quarter total operating expenses increased 2.9% year over year to $3.54 billion. The increase was due to a rise in purchased power and fuel expenses, and increased operation and maintenance expenses.

Operating income was $694 million, up 19.7% year over year.

Interest expenses totaled $358 million, up 10.5% from the year-ago quarter.

Financial Highlights

Cash and cash equivalents were $816 million as of Jun 30, 2022, compared with $672 million as of Dec 31, 2021.

Long-term debt was $35,789 million as of Jun 30, 2022, compared with $30,749 million as of Dec 31, 2021.

Cash provided (used in) for operating activities for the first six months of 2022 was $3,420 million compared with $1,138 million in the first six months of 2021.

Guidance

Exelon has reiterated its 2022 earnings at $2.18-$2.32 per share. The mid-point of the revised guided range is $2.25, lower than the Zacks Consensus Estimate of $2.28 per share for the same period.

Exelon plans to issue up to $1.0 billion of registered shares of common stock through 2025. The company aims to establish a $1.0-billion ATM program under which it can issue registered shares of common stock through designated broker-dealers at prevailing market prices.

How Have Estimates Been Moving Since Then?

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

VGM Scores

Currently, Exelon has a subpar Growth Score of D, however its Momentum Score is doing a lot better with a B. Following the exact same course, 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 C. 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 these revisions looks promising. Notably, Exelon has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.

Performance of an Industry Player

Exelon is part of the Zacks Utility - Electric Power industry. Over the past month, WEC Energy Group (WEC), a stock from the same industry, has gained 0.8%. The company reported its results for the quarter ended June 2022 more than a month ago.

WEC Energy reported revenues of $2.13 billion in the last reported quarter, representing a year-over-year change of +27%. EPS of $0.91 for the same period compares with $0.87 a year ago.

WEC Energy is expected to post earnings of $0.85 per share for the current quarter, representing a year-over-year change of -7.6%. Over the last 30 days, the Zacks Consensus Estimate has changed -1.2%.

WEC Energy has a Zacks Rank #3 (Hold) based on the overall direction and magnitude of estimate revisions. Additionally, the stock has a VGM Score of C.


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