Pepco Holdings Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Pepco Holdings (NYSE:POM) will unveil its latest earnings on Tuesday, November 6, 2012. Pepco Holdings is an energy company that delivers electricity and natural gas and generates and supplies energy.

Pepco Holdings Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 41 cents per share, a rise of 17.1% from the company’s actual earnings for the year-ago quarter. During the past three months, the average estimate has moved up from 39 cents. Between one and three months ago, the average estimate moved up. It has been unchanged at 41 cents during the last month. For the year, analysts are projecting net income of $1.20 per share, a decline of 4% from last year.

Past Earnings Performance: Last quarter, the company fell short of estimates by 5 cents, coming in at profit of 25 cents per share against a mean estimate of net income of 32 cents. The company topped expectations in the first quarter.

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A Look Back: In the second quarter, profit fell 34% to $62 million (27 cents a share) from $94 million (42 cents a share) the year earlier, missing analyst expectations. Revenue fell 16.3% to $1.18 billion from $1.41 billion.

Wall St. Revenue Expectations: On average, analysts predict $1.72 billion in revenue this quarter, a rise of 4.9% from the year-ago quarter. Analysts are forecasting total revenue of $5.65 billion for the year, a decline of 4.6% from last year’s revenue of $5.92 billion.

Stock Price Performance: From October 3, 2012 to October 31, 2012, the stock price rose 56 cents (2.9%), from $19.31 to $19.87. The stock price saw one of its best stretches over the last year between September 27, 2012 and October 5, 2012, when shares rose for seven straight days, increasing 2.7% (+51 cents) over that span. It saw one of its worst periods between February 17, 2012 and February 29, 2012 when shares fell for eight straight days, dropping 3.5% (-70 cents) over that span.

Key Stats:

On the top line, the company is hoping to use this earnings announcement to snap a string of four-straight quarters of revenue decreases. Revenue fell 20.5% in the third quarter of the last fiscal year, 18.7% in fourth quarter of the last fiscal year and 20.9% in the first quarter and then fell again in the second quarter.

The company is hoping to rebound with this earnings release after a net income drop last quarter. Net income rose 6.3% in the first quarter before dropping in the second quarter.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 0.69 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.

Analyst Ratings: There are mostly holds on the stock with nine of 10 analysts surveyed giving that rating.

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

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