Pinnacle West (PNW) Q4 Earnings and Revenue Exceed Estimates – February 25, 2022

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Pinnacle West Capital Corporation (PNO Free Report) reported fourth-quarter 2021 operating earnings per share (EPS) of 24 cents, which beat Zacks’ consensus estimate of 7 cents by 242.9%.

Net income also improved 101.4% from a year-ago quarter earnings loss of 17 cents per share. The improvement in quarterly earnings was driven by an increase in revenue, driven by increased customer usage and growth.

Pinnacle West reported operating EPS of $5.47 in 2021, down 12.3% from $4.87 in 2020. Total profit beat Zacks’ consensus estimate of 3.4% $5.29 per share.

Total revenue

Total revenue of $798.9 million for the fourth quarter of 2021 beat Zacks’ consensus estimate of $701 million by 14%. Revenue also improved 7.8% from $741 million in the year-ago quarter.

Pinnacle West reported total revenue of $3,803.8 million in 2021, up 6.04% from $3,587 million in 2020. Total revenue also topped the estimate by 2.5% from the Zacks consensus of $3,710 million.

Pinnacle West Capital Corporation EPS Price, Consensus and Surprise

Pinnacle West Capital Corporation price-consensus-eps-surprise-chart | Quote from Pinnacle West Capital Corporation

Operational Highlights

In the fourth quarter, total operating expenses were $748.8 million, up 5.5% from the year-ago quarter level, due to an increase in the cost of purchase of fuel and electricity.

Fourth-quarter operating profit was $50 million, up 62.3% from the year-ago quarter of $30.8 million.

Net interest expense was $59.9 million, up 1.5% from the prior year quarter reading of $59 million.

Pinnacle West reported 2.2% year-over-year customer growth in 2021.

Financial Highlights

Cash and cash equivalents were $10 million as of December 31, 2021, compared to $60 million as of December 31, 2020.

Long-term debt less current maturities was $6,913.7 million as of December 31, 2021, up from $6,314.3 million as of December 31, 2020.

Free cash flow from operating activities in 2021 was $860 million, compared to $966.4 million in 2020.

Advice

Pinnacle West forecasts 2022 EPS between $3.90 and $4.10. The Zacks consensus estimate for 2022 earnings of $3.90 per share is below $4, which is the midpoint of the guided range.

Pinnacle West reiterated retail customer growth in the 1.5-2.5% range through 2024. The utility plans to invest $4.7 billion over the 2022-24 period to support customer growth, reliability and clean transition.

He expects the rate base to increase annually by almost 5-6% through 2024 from 2020 levels.

Zacks Rank

Pinnacle West currently has a Zacks rank #3 (Hold). You can see the full list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming releases

Algonquin Power & Utilities (AQN Free Report) is expected to release its fourth quarter 2021 results on March 3 after market close. The Zacks consensus estimate for fourth-quarter EPS is pegged at 21 cents.

Long-term (three to five years) earnings growth for Algonquin Power & Utilities is currently pegged at 8.7%. The Zacks consensus estimate for AQN earnings in 2022 implies 4.5% year-over-year growth.

Pampas Energy (WFP Free Report) is expected to release its fourth quarter 2021 results on March 10 after market close. The Zacks consensus estimate for fourth-quarter EPS is pegged at 82 cents.

Pampa Energia’s long-term earnings growth is currently pegged at 52.4%. The Zacks consensus estimate for PAM earnings in 2021 implies 126.64% year-over-year growth.

World Water Resources Inc. (GWRS Free Report) is expected to release its fourth quarter 2021 results on March 10 before market open. The Zacks consensus estimate for fourth-quarter EPS is pegged at 1 cent.

Global Water Resources’ long-term earnings growth is currently pegged at 15%. The Zacks consensus estimate for GWRS earnings in 2022 implies 6.7% year-over-year growth.

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