Entergy Beats 4Q Earnings Estimates, Misses On Revenues

Entergy reported better-than-expected earnings in the fourth quarter, but lagged analysts’ expectations for revenues. Shares of the energy company dipped 1.3% to close at $89.97 on Feb. 24.

Entergy’s (ETR) 4Q adjusted earnings increased 4.4% to $0.71 per share on a year-over-year basis and beat the Street estimates of $0.66. Revenues declined 3.7% to $2.37 billion and came in below analysts’ expectations of $2.8 billion.

The company’s operating expenses came in at $2.2 billion, almost stable year-over-year. Revenues generated from natural gas operations declined 14.1% to $35.2 million. (See Entergy stock analysis on TipRanks)

For 2021, the company expects adjusted EPS to land between $5.80 to $6.10, versus the consensus of $5.89.

Entergy CEO Leo Denault said, “We are reporting strong results for another very successful year. Our adjusted earnings per share were in the top half of our guidance range as we exceeded our $100 million cost savings target for the year.”

On Jan. 21, Evercore ISI analyst Durgesh Chopra upgraded the stock to Buy from Hold and increased the price target to $110 (22.3% upside potential) from $106, as the firm “shook up its Energy sector ratings with a cautious view on the group in the near-term and a preference for value over quality.”

Longer-term, Chopra “is more constructive on the group, citing both valuation support and the view that a Biden presidency is a major tailwind for the sector.”

The consensus rating among analysts is a Strong Buy based on 6 Buys and 2 Holds. The average analyst price target stands at $112.63 and implies upside potential of more than 25% to current levels over the next 12 months.

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