FirstEnergy Misses Where It Counts

Seth Jayson, The Motley Fool
Updated

FirstEnergy (NYS: FE) reported earnings on Aug. 7. Here are the numbers you need to know.

The 10-second takeaway
 For the quarter ended June 30 (Q2), FirstEnergy beat expectations on revenues and missed estimates on earnings per share.

Compared to the prior-year quarter, revenue contracted and GAAP earnings per share grew.


Gross margins shrank, operating margins increased, net margins increased.

Revenue details
 FirstEnergy recorded revenue of $3.90 billion. The four analysts polled by S&P Capital IQ foresaw a top line of $3.58 billion on the same basis. GAAP reported sales were 1.9% lower than the prior-year quarter's $3.95 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
 EPS came in at $0.60. The 13 earnings estimates compiled by S&P Capital IQ predicted $0.65 per share. GAAP EPS of $0.45 for Q2 were 7.1% higher than the prior-year quarter's $0.42 per share.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
 For the quarter, gross margin was 51.6%, 200 basis points worse than the prior-year quarter. Operating margin was 14.4%, 110 basis points better than the prior-year quarter. Net margin was 4.8%, 20 basis points better than the prior-year quarter.

Looking ahead
 Next quarter's average estimate for revenue is $4.33 billion. On the bottom line, the average EPS estimate is $1.17.

Next year's average estimate for revenue is $16.50 billion. The average EPS estimate is $3.40.

Investor sentiment
 The stock has a four-star rating (out of five) at Motley Fool CAPS, with 369 members out of 390 rating the stock outperform, and 21 members rating it underperform. Among 82 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 76 give FirstEnergy a green thumbs-up, and six give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on FirstEnergy is outperform, with an average price target of $49.47.

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The article FirstEnergy Misses Where It Counts originally appeared on Fool.com.

Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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