Duke Energy (DUK) Down by 6%, Can it Bounce Back?

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It has been a month ago since Duke Energy Corporation reported their earnings. During this period, the company lost around 6%. Does this loss mean a possible high in the near future or it is a warning for a possible breakout?

While we make our own conclusion on the recent figures that the company is giving us, it still bests that we look into the most recent earnings of Duke Energy so we can weigh things accurately and properly decide our next possible move.

Q1 of Duke Caused by Favorable Weather

Zacks Consensus’ estimates of the earnings of Duke Energy Corporation have been beaten by its actual earnings of $1.28 per share. Accordingly, this is caused by the normalization of the weather condition and the increase of investments in electric and gas utilities.

Total Revenues

Duke Energy’s earnings for the first quarter is 7.1% higher than the first quarter of 2017 with its $6.14 billion total operating revenue with $5.3 billion coming from electric unit revenues, $0.7 billion from regulated natural gas and $0.15 billion from non-regulated electric revenues.

Segmental Highlights of the Quarter

Electric Utilities and Infrastructure

Lower expenses in income tax, as well as operation and maintenance expenses, have caused the adjusted income of the company to rise at $816 million for the first quarter of this year. Also, the good weather and the high retail revenues also added to this increase.

Gas Utilities and Infrastructure

The $158 million adjusted earnings of the company were driven by the growth in the number of customers and the increase of investments.

Commercial Renewables

The $20 million adjusted earnings of the company for this quarter has made the company decide to lower wind resource in the future as it lower than the reported earnings in the first quarter of the year ago which is amounting to $25 million.

Expenses

The corporate internet expenses have resulted from Duke Energy’s captive insurance and other investments. Also, the adjusted net expenses of Duke this year’s first quarter reached $95 million from $67 million last year.

Financial Condition

Duke Energy had a cash and cash equivalents of $421 million as of March 31, 2018. Its long-term debt is at $49 billion which is almost the same amount with the long-term debt of the previous year. This year’s first quarter has a net cash of $1,391 million.

Estimate Movements and Guidance

Analysts and investors have witnessed a downtrend in fresh estimates and it also continues its expectations of hitting adjusted earnings of $4.55 to $4.85 per share.

VGM Scores

Currently, DUK has a Growth Score of D, however, its momentum has a lot better performance as it has a score of B. On the value side, it has a grade of C making it on the middle 20% for investment strategy. Overall, it has a VGM Score of C making it one of the best stocks to focus on for those who aren’t focused on one strategy.

This stock is more suitable for momentum investors rather than value-hunting investors.

Outlook:

The figures have been showing a downward trending for this stock. However, we are still positive that it will have a shift in the following months and expects an above average return.