Oakland, California-based PG&E Corporation (PCG) is the parent company of California’s largest regulated electric and gas utility, Pacific Gas and Electric Company. With a market cap of $59.5 billion, it provides electricity and natural gas to Northern and Central California through a mix of nuclear, hydroelectric, and renewable energy sources. PCG is set to unveil its fiscal Q3 earnings results before the market opens on Thursday, Nov. 7.
Ahead of this event, analysts expect the power company to report a profit of $0.29 per share, up 20.8% from $0.24 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in three of the past four quarters while missing on another occasion. PCG exceeded the consensus EPS estimate by a 3.3% margin in Q2 due to higher service rates.
For fiscal 2024, analysts expect PCG to report EPS of $1.36, up 10.6% from $1.23 in fiscal 2023.
PCG has underperformed the broader markets in 2024, with shares up 14.5%, compared to the S&P 500 Index's ($SPX) 22.8% gain and the Utilities Select Sector SPDR Fund's (XLU) 28.6% increase on a YTD basis.
Despite reporting better-than-expected Q2 adjusted EPS of $0.31 and revenue of around $6 billion, PG&E shares fell 1.3% on Jul. 25 due to concerns over its lowered 2024 GAAP earnings forecast to $1.11 per share - $1.17 per share. Rising unrecoverable interest expenses, expected to reach up to $365 million after tax, heightened worries about the financial strain. Additionally, ongoing wildfire-related costs and amortization of wildfire fund liabilities underscored persistent cost burdens, adding to investor caution.
Analysts' consensus rating on PCG stock is bullish, with a "Strong Buy" rating overall. Out of 16 analysts covering the stock, opinions include 12 "Strong Buys,” one "Moderate Buy," and three "Holds.” This configuration is more bullish than three months ago, with 10 analysts suggesting a "Strong Buy." As of writing, PCG is trading below the average analyst price target of $23.20.
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