TransCanada Earnings: Here’s Why Shares are Up Now

TransCanada Corp. (NYSE:TRP) delivered a profit and missed 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 up 0.8%.

TransCanada Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 18.6% to $0.51 in the quarter versus EPS of $0.43 in the year-earlier quarter.

Revenue: Rose 9.14% to $2.01 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: TransCanada Corp. reported adjusted EPS income of $0.51 per share. By that measure, the company missed the mean analyst estimate of $0.52. It missed the average revenue estimate of $2.14 billion.

Quoting Management: “All three of our business segments generated strong results during the second quarter,” said Russ Girling, TransCanada’s president and chief executive officer. “Higher power prices in Alberta, an increase in capacity prices in New York, the return to an eight unit site at Bruce Power and a higher Canadian Mainline allowed return on equity all contributed to a significant increase in earnings when compared to the same period last year. We were also pleased by the significant shipper interest in our Energy East Pipeline project, which would transport crude oil from western Canada to eastern Canadian markets and add to our existing $26 billion portfolio of commercially secured projects that are targeted for completion by the end of the decade.”

Key Stats (on next page)…

Revenue decreased 12.95% from $2.31 billion in the previous quarter. EPS decreased 1.92% from $0.52 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.60 to a profit $0.59. For the current year, the average estimate has moved down from a profit of $2.31 to a profit of $2.25 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)