Will Dominion Energy’s Q4 Earnings Help Its Stock?



Dominion Energy’s fourth-quarter EPS

Dominion Energy (D), the third-largest utility by market cap, reported its fourth-quarter and fiscal 2018 earnings on February 1. The company reported an operating EPS of $0.89, which missed the consensus estimates for the quarter ending December 31. Dominion Energy posted an EPS of $0.91 in the fourth quarter of 2017. The extended outage at the Millstone power plant and lower renewable energy investment tax credits had a negative impact on Dominion Energy’s earnings during the quarter.

For fiscal 2018, Dominion Energy had an EPS of $4.05, which is ~13% higher compared to 2017. Dominion Energy stock has been under pressure from the last few months. So far this year, Dominion Energy has fallen more than 1%, while broader utilities (XLU) have risen almost 6%.


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Earnings highlights

Dominion Energy posted total revenues of $3.36 billion in the fourth quarter—an increase of ~5% compared to the same quarter in 2017. The company’s 2018 revenues increased 6% compared to 2017. Dominion Energy’s total number of customers increased 1%, while the total electricity delivered to the Retail segment rose 3% in the fourth quarter—compared to the fourth quarter of 2017.

Dominion Energy provided a cost and schedule update on the Atlantic Coast pipeline project. The project is expected to be in service by early 2021. The project is estimated to cost $7.0 billion–$7.5 billion, excluding financing costs.

Dominion Energy has given an earnings guidance range of $4.05–$4.40 per share for 2019. The company has maintained the earnings growth rate of 6%–8% through 2020, which is relatively higher than utilities at large. Dominion Energy completed the acquisition of its MLP subsidiary, Dominion Midstream Partners, on January 28.

NextEra Energy (NEE), the biggest utility, reported its earnings last week.


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