Ameren Corporation AEE will release first-quarter 2015 financial results before the market opens on May 7. In the previous quarter, this utility reported a positive earnings surprise of 35.71%. Let’s see how things are turning out for the first quarter.
Factors to Note
Ameren Corporation generates a substantial portion of electricity from coal-fired facilities. Despite executing several pollution-control measures and focusing on expanding its renewable portfolio, increasing stringency of government regulations to ensure clean power generation remains a major concern. In 2014, power generated from coal-based assets constituted 76% of total electricity.
Ameren Corp. plans to complete several important projects in 2015, which will enable the company to provide reliable services to its customers, besides meeting increasing demand.
Earnings Whispers?
Our proven model shows that Ameren Corporation is not likely to beat earnings estimates this quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), #2 (Buy) or #3 (Hold) to be able to beat consensus estimates. That is not the case here as you will see below.
Zacks ESP: The Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is 0.00%. This is because the Most Accurate estimate and the Zacks Consensus Estimate are both pegged at 35 cents.
Zacks Rank: Though Ameren’s Zacks Rank #2 (Buy) increases the predictive power, the 0.00% ESP makes a positive earnings surprise call unlikely.
We caution against stocks with a Zacks Rank #4 and 5 (Sell-rated stocks) going into the earnings announcement, especially when the company is seeing negative estimate revisions.
Stocks to Consider
Here are some stocks you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this season:
Vectren Corp. VVC has an earnings ESP of +4.11% and a Zacks Rank #2.
Consolidated Edison, Inc. ED has an earnings ESP of +1.71% and a Zacks Rank #3.
Cincinnati Bell Inc. CBB has an earnings ESP of +80.0% and a Zacks Rank #3.
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