Zacks
0
All posts from Zacks
Zacks in Our Research. Your Success.,

Is Disappointment in Store for SCANA (SCG) in Q2 Earnings?

Electric utility SCANA Corporation SCG is expected to report second-quarter 2017 earnings on Aug 3, before the market opens.

Last quarter, the company reported a negative earnings surprise of 13.14%. However, the average positive earnings surprise for the last four quarters was 1.87%. Let’s see how things are shaping up prior to the announcement.

Factors Likely to Influence this Quarter

SCANA Corp. is well positioned to benefit from a positive regulatory environment as it has a low risk business with outstanding customer growth and operational efficiency. These factors are favorable for stable cash flow generation and growth.

However, during the first quarter of 2017, the company’s cash balance decreased 94.2% while long-term debt has been on the rise since the beginning of 2014, reflecting huge costs related to nuclear projects. Hence, the company’s weak balance sheet is a lingering concern.  

Q2 Price Performance

Shares of SCANA have gained 2.6% during the quarter, significantly outperforming the industry’s 0.1% rise.

Earnings Whispers

Our proven model does not conclusively show an earnings beat for SCANA Corp. 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) for this to happen. That is not the case here as you will see below.

Zacks ESP: Earnings ESP, which represents the difference between the Most Accurate estimate and the Zacks Consensus Estimate, is -1.35%. This is because the Most Accurate estimate is at 73 cents, while the Zacks Consensus Estimate is higher at 74 cents. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: SCANA Corp. carries a Zacks Rank #4 (Sell). Please note that the Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement. 

Stocks to Consider

Here are some firms that you may want to consider on the basis of our model. These have the right combination of elements to beat earnings this quarter.

Global Partners LP GLP has an Earnings ESP of +60.00% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Chesapeake Energy Corporation CHK has an Earnings ESP of + 7.14% and a Zacks Rank #3.

The Williams Companies Inc WMB has an Earnings ESP of +21.05% and a Zacks Rank #3.

Will You Make a Fortune on the Shift to Electric Cars?

Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.

With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.

It's not the one you think.

See This Ticker Free >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Scana Corporation (SCG): Free Stock Analysis Report
 
Global Partners LP (GLP): Free Stock Analysis Report
 
Williams Companies, Inc. (The) (WMB): Free Stock Analysis Report
 
Chesapeake Energy Corporation (CHK): Free Stock Analysis Report
 
To read this article on Zacks.com click here.
 
Zacks Investment Research