CenterPoint Energy Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component CenterPoint Energy (NYSE:CNP) will unveil its latest earnings on Wednesday, November 7, 2012. CenterPoint Energy is a public utility holding company that operates electric transmission and distribution facilities, interstate pipelines, and natural gas gathering, processing, and treating facilities.

CenterPoint Energy Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 34 cents per share, a decline of 8.1% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from 33 cents. Between one and three months ago, the average estimate was unchanged. It has risen during the last month. Analysts are projecting profit to rise by 1.7% compared to last year’s $1.18.

Past Earnings Performance: The company has beaten estimates the last four quarters and is coming off a quarter where it topped forecasts by 2 cents, reporting net income of 27 cents per share against a mean estimate of profit of 25 cents per share.

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Wall St. Revenue Expectations: Analysts are projecting a rise of 16% in revenue from the year-earlier quarter to $2.18 billion.

A Look Back: In the second quarter, profit rose 5.9% to $126 million (29 cents a share) from $119 million (28 cents a share) the year earlier, exceeding analyst expectations. Revenue fell 17% to $1.52 billion from $1.84 billion.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.92 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, a ratio less than one could indicate a company may have difficulty meeting current obligations. The company regressed in this liquidity measure from 1.09 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 17.2% to $3.21 billion while assets decreased 0.4% to $2.96 billion.

Key Stats:

Heading into this earnings announcement, the company is trying build on some positive momentum from last quarter’s income increase. After net income declines in the fourth quarter of the last fiscal year and first quarter, profit rose in the second quarter.

On the top line, the company is hoping to use this earnings announcement to snap a string of two-straight quarters of revenue declines. Revenue fell 19.4% in the first quarter and dropped again in the second quarter.

Stock Price Performance: Between September 6, 2012 and November 1, 2012, the stock price had risen 75 cents (3.6%), from $20.99 to $21.74. The stock price saw one of its best stretches over the last year between April 23, 2012 and May 1, 2012, when shares rose for seven straight days, increasing 5.9% (+$1.14) over that span. It saw one of its worst periods between August 10, 2012 and August 17, 2012 when shares fell for six straight days, dropping 4% (-84 cents) over that span.

Analyst Ratings: There are mostly holds on the stock with eight of 13 analysts surveyed giving that rating.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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