Dominion Resources Earnings: Revenue Off the Mark

Dominion Resources, Inc. (NYSE:D) delivered a profit and met Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 0.81%.

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Dominion Resources, Inc. Earnings Cheat Sheet

Results: Net income increased 99% to $400 million (69 cents per diluted share) in the quarter versus a net gain of $201 million in the year-earlier quarter.

Revenue: Decreased 0.25% to $3.17 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Dominion Resources, Inc. reported adjusted net income of 69 cents per share. By that measure, the company met the mean analyst estimate of $0.69. It missed the average revenue estimate of $3.74 billion.

Quoting Management: Thomas F. Farrell II, Chairman, President and CEO, said, “2012 was a year of significant accomplishments for Dominion.  Several major capital projects were completed, significant progress was made on others and we worked to advance the next round of infrastructure growth..In our Generation segment last year, the 585-megawatt Virginia City Hybrid Energy Center was placed into commercial operation on schedule and on budget after four years of construction. Construction continues on schedule for the 1,329-megawatt, gas-fired power station in Warren County, Va.  The approximately $1.1 billion project is scheduled for completion in late 2014.  Progress continues on the development of a similar-sized combined-cycle facility, the Brunswick County Power Station.  We recently filed for regulatory approval with the Virginia State Corporation Commission and, pending approval, expect commercial operation in 2016.  The coal-to-biomass conversions of Altavista, Southampton, and Hopewell are proceeding on schedule and are projected to come online by the end of this year. Also, we recently filed an application for a coal-to-natural gas conversion of our 227-megawatt Bremo Power Station.  Commercial operation is expected in 2014, pending regulatory approval…

…At our Energy segment, the Appalachian Gateway Project, which transports natural gas produced in West Virginia and Pennsylvania was placed into service on time and within budget.  Also entering service last year were two major projects providing transportation services of Marcellus Shale volumes, the Ellisburg to Craigs and the Northeast Expansion. Construction on Phase 1 of the Natrium natural gas processing and fractionation plant is nearing completion and scheduled for operation this quarter.  And, we entered into a joint venture, Blue Racer Midstream, LLC, to provide gathering and processing to producers in the Utica shale region.

Key Stats:

Revenue decreased 7.07% from $3.41 billion in the previous quarter. Net income increased 91.39% from $209 million in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.92 to a profit $0.93. For the current year, the average estimate has moved down from a profit of $3.08 to a profit of $3.06 over the last ninety days.

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(Company fundamentals provided by Xignite Financials.)