Evergy (EVRG) Down 3.1% Since Last Earnings Report: Can It Rebound?

It has been about a month since the last earnings report for Evergy Inc (EVRG). Shares have lost about 3.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Evergy 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 catalysts.

Evergy's Q4 Earnings and Revenues Miss Estimates

Evergy, Inc.  reported fourth-quarter 2018 operating earnings of 8 cents per share, lagging the Zacks Consensus Estimate of 24 cents by 66.7% but improving from the year-ago loss of 25 cents.

The year-over-year improvement of the bottom line is attributable to favorable weather and lower income tax expense, owing to year-over-year increase in pro-forma earnings.

Total Revenues

Evergy’s total revenues came in at $1,199.8 million, improving 101.7% year over year. However, the figure lagged the Zacks Consensus Estimate of $1,256 million by 4.5%.

Highlights of the Release

Total operating expenses increased 122.1% year over year to $1,049.7 million, due to higher fuel and purchased power, along with operation and maintenance costs.

Interest and related charges in the reported quarter were $88.3 million, up 106.3% from the year-ago level.

During the year, the company retired 1,500 MW of coal-fired generation from its portfolio and added 244 MW of wind energy in its generation assets.

The company repurchased shares worth $1,042.3 million and paid dividend of $475 million during 2018.

Financial Update

Cash and cash equivalents as of Dec 31, 2018 were $160.3 million compared with $3.4 million in the corresponding period of 2017.

Long-term debt as of Dec 31, 2018 was $6.64 billion compared with $3.69 billion at the end of 2017.

Cash from operating activities in 2018 was $1,497.8 million, up 64.1% from $912.7 million a year ago.

How Have Estimates Been Moving Since Then?

In the past month, investors have witnessed a downward trend in fresh estimates. The consensus estimate has shifted -19.91% due to these changes.

VGM Scores

Currently, Evergy has a poor Growth Score of F, however its Momentum Score is doing a bit better with a D. Following the exact same course, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.

Overall, the stock has an aggregate VGM Score of F. If you aren’t focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of this revision indicates a downward shift. It’s no surprise Evergy has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.

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Source: Zacks



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