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CenterPoint Energy (CNP) earnings: expect 22% revenue growth

3:53 pm ET, 08 May 2019

CenterPoint Energy (CNP) is announcing earnings on May 09 before market opening. We combed through analyst estimates to understand what the company revenue and earnings are predicted to look like.

What should you expect from the upcoming earnings?

Revenue for the next quarter is expected to be $3.85B, which implies a 22% growth rate year-over-year.

Earnings per share are expected to come in at $0.50. If this materializes, EPS will decline -9% year-over-year.

How did the stock do last month?

Over the last month, CenterPoint Energy (CNP) returned +1.47%.

How is the stock valued?

CenterPoint Energy (CNP) forward P/E ratio is 17.01, and it’s low compared to its industry peers’ P/E ratios.

What do analysts say about the stock?

CenterPoint Energy (CNP) average analyst price target is 6.88% above its current price ($30.66).

For the latest price and information on CenterPoint Energy, please visit Finstead and ask for "CNP", "CNP analysis" or "CNP news".

CenterPoint Energy, Inc. (CNP) Stock Guide

Updated at: 2:39 pm ET, 17 Sep 2020

Before we start: if you're looking for CNP stock price, you can quickly find it out by visiting Finny and typing "CNP quote". If you're looking for a quick scoop on CNP stock (chart, price target, market cap, news and buy or sell analysis), go to Finny and look for "CNP". You'll get all this info in one place. Or you can just type "CNP news" to get the latest stock news.

Looking to buy or sell CenterPoint Energy, Inc. (CNP)? Interested in getting the full scoop on CNP, including earnings and dividends, stock forecast, buy or sell analysis and key stats? If so, you came to the right place.

In this CNP stock guide, we'll address key questions about CNP, above and beyond what you can find on Yahoo Finance, Zacks, MarketWatch or Morningstar.

Here is what you'll be able to find in this guide:

Earnings and Dividends: earnings, earnings date, dividend rate and dividend yield;
Analyst Predictions: stock forecast and analyst ratings;
Analysis: Finny Score and buy or sell analysis;
Key Stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio, industry, sector, and number of employees.

And here is the list of questions we'll answer:
1. What are CNP earnings?
2. What is CNP dividend?
3. What is CNP dividend yield?
4. What is CNP stock forecast (i.e., prediction)?
5. CNP buy or sell? What is CNP Finny Score?
6. What are the reasons to buy CNP? Why should I buy CNP stock?
7. What are the reasons to sell CNP? Why should I sell CNP stock?
8. What are CNP key stats: revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

So let's start. Scroll down to the question that interests you the most.

Earnings and Dividends

1. What are CNP earnings?

CNP trailing 12-month earnings per share (EPS) is -$1.58.

2. What is CNP dividend?

CNP forward dividend is $0.60.

3. What is CNP dividend yield?

CNP forward dividend yield is 3.01%.

Analyst Predictions

4. What is CNP stock forecast (i.e., prediction)?

Based on CNP analyst price targets, CNP stock forecast is $20.87 (for a year from now). That means the average analyst price target for CNP stock is $20.87. The prediction is based on 16 analyst estimates.

The low price target for CNP is $17.00, while the high price target is $25.00.

CNP analyst rating is Hold.

Analysis

5. CNP buy or sell? What is CNP Finny Score?

#{finnyScore:57}Our quantitative analysis shows 4 reasons to buy and 3 reasons to sell CNP, resulting in Finny Score of 57.

6. What are the reasons to buy CNP? Why should I buy CNP stock?

Here are the reasons to buy CNP stock:

  • Strong utility earnings growth and cash distributions from Enable should allow annual dividend growth above 4% during the next five years.
  • The formation of Enable will allow CenterPoint to focus capital expenditures on its utilities, resulting in annual rate-base growth exceeding 7% during the next five years.
  • Houston Electric's service territory is located in one of the most economically vibrant metro areas in the country, with recent average annual customer growth over 2%.
  • CenterPoint Energy is investing substantially to expand its operations to cope with increasing utility demand. The company is currently focused on upgrading infrastructure and improving reliability. CenterPoint Energy’s capital expenditure in first-quarter 2018 was $323 million, compared to $298 million at 2017’s first-quarter. The company’s current capital outlay of $8.2 billion from 2018 through 2022, includes an investment of $1.7 billion in 2018.
  • Under the Electric Transmission & Distribution division, CenterPoint Energy plans investments of roughly $4.8 billion through the 2018–2022 period. For Natural Gas Distribution division, the company will spend $3.2 billion during this time period. These funds will be utilized primarily to maintain reliability and safety, increase resiliency and expand CenterPoint Energy’s systems through value- added projects.
  • In April 2018, CenterPoint Energy announced its merger agreement with Vectren Corporation, which is expected to create a leading energy delivery, infrastructure and services company, catering to more than 7 million customers across the United States. The combined company is expected to have electric and natural gas delivery operations in eight states with assets totaling $29 billion and an enterprise value of $27 billion. Per management, the new enterprise will realize additional earnings by investing regulated capital, more than $2 billion each year through 2022, to meet the needs of the 7 million plus customer base.
  • CenterPoint Energy judiciously utilizes its funds in growth projects and at the same time preserves a stable financial position. As of March 31, 2018, the company had cash and cash equivalents of $219 million. At the end of first-quarter 2018, the company’s net cash from operating activities was $484 million, compared with $317 million a year ago.
  • CNP forward dividend yield is 3.01%, higher than the industry (1.56%) and sector (1.36%) forward dividend yields. See CNP forward dividend chart.
  • CNP Price/Sales ratio is 0.90, which is low compared to its industry peers’ P/S ratios. See CNP forward Price/Sales ratio chart.
  • CNP cash to debt ratio is 0.08, higher than the average industry (0.07) and sector (0.05) cash to debt ratio. See CNP cash to debt chart.
  • CNP Enterprise Value/Revenue multiple is 2.08, which is low compared to its industry peers’ Enterprise Value/Revenue multiples. See CNP Enterprise Value/Revenue chart.

7. What are the reasons to sell CNP? Why should I sell CNP stock?

Let's look at the reasons to sell CNP stock (i.e., the bear case):

  • Houston Electric has recently benefited from abnormally high transmission right-of-way revenues. These revenues likely peaked in 2013 and have declined the last few years.
  • Profitability in the competitive natural gas sales and service business should expand with recent acquisitions, but this business does not have an economic moat and has many competitors.
  • Low commodity prices continue to pressure earnings for pipelines and field services infrastructure serving dry gas regions, which will act as a headwind for Enable.
  • The performance of CenterPoint Energy’s regulated electricity and natural gas utilities depends upon rate relief at regular intervals in its different service areas. Any adverse decision in pending regulatory cases can impact the company’s earnings substantially. The proceeds are used to finance a portion of its expansion program.
  • A substantial portion of CenterPoint Energy’s operations are located along the gulf coast of the U.S., a high-risk area with strong hurricane activity. This exposes the company’s utility plants to damage and expenditures associated with storm-related restoration. In spite of having general liability and property insurance, insurance coverage may not cover all expenses incurred by the company.
  • As of March 31, 2018, CenterPoint Energy had $7.8 billion of outstanding fixed-rate debt. Such debt levels increase its vulnerability to adverse economic or industry conditions. Moreover, it will require the company to dedicate a portion of its cash flow from operations to repayments of debt, thereby reducing the availability of cash flow to fund working capital, capital expenditures as well as strategic initiatives.
  • CNP quarterly revenue growth was -5.00%, lower than the industry and sector average revenue growth (0.38% and 0.75%, respectively). See CNP revenue growth chart.
  • CNP profitability is declining. The YoY profit margin change was -15.49 percentage points. See CNP profitability chart.
  • CNP short interest (days to cover the shorts) ratio is 2.66. The stock garners more short interest than the average industry, sector or S&P 500 stock. See CNP short interest ratio chart.

Key Stats

8. What are CNP key stats : revenue, market cap, revenue growth, profit margin, P/E ratio, P/B ratio industry, sector, and number of employees?

Let's look at the key statistics for CNP:

Metrics CNP
Price $21.34
Average Price Target / Upside $20.93 / -1.90%
Average Analyst Rating Hold
Forward Dividend Yield 2.78%
Industry Utilities - Regulated Gas
Sector Utilities
Number of Employees 7,977
Market Cap $11.33B
Forward P/E Ratio 15.40
Price/Book Ratio 0.93
Revenue (TTM) $12.16B
YoY Quarterly Revenue Growth -5.00%
Profit Margin -5.49%

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