Earnings Previews: Algonquin Power, Joby Aviation, Nio

Markets

Early trading Wednesday had two of the three major U.S. indexes in the green. Tuesday’s up-and-down regular session ended with the Nasdaq up 1% while the Dow Jones industrials and the S&P 500 finished the day down and up a quarter-point, respectively. The monthly consumer price index (CPI) rose 0.3% month over month in April, a steep drop from the 1.2% increase between March and April. The annual rate declined from 8.5% to 8.3%. Core inflation, excluding food and energy, rose 0.6% month over month and stands at 6.2% for the past 12 months.

After markets closed Tuesday, cryptocurrency exchange Coinbase missed analysts’ estimates on both the top and bottom lines. The company said it expects lower trading volume in the current quarter. The stock traded down about 12.6% shortly after Wednesday’s opening bell.

Kinross Gold matched analysts’ consensus earnings estimate but missed the forecast revenue number. The company also said it plans to reduce its capital spending in each of the next three years. Shares were up about 0.4% early Wednesday.

Occidental Petroleum traded up by about 1.9% after beating both the top-line and bottom-line estimates.

SoFi Technologies released its earnings report before markets closed Tuesday, following an early leak of the results. Trading was halted on the stock and shares closed down 12% for the day. In early trading Wednesday, the stock was down about 2.6%, after meeting the profit estimate and beating on revenue. The decentralized finance company also lowered its revenue guidance for the current quarter but guided full-year sales above estimates.

We already have previewed four companies set to report results after markets close Wednesday: Bakkt, Coupang, Disney and Rivian. And we have taken a look at what to expect when Affirm, Aurora Cannabis and Toast report earnings late on Thursday.

Here is a look at three more companies set to report results after Thursday’s close.

Algonquin Power

Over the past 12 months, only one market sector, energy, has outperformed the utilities sector. Algonquin Power & Utilities Corp. (NYSE: AQN) did not help, dropping more than 10% from its share price over the 12-month period. Since posting a new 52-week high in early April, the stock has fallen by more than 15%.

Yet, Algonquin, which provides electricity, natural gas and water services to customers in the United States, Canada, Chile, and Bermuda, pays a handsome dividend that is quite safe because most of the company’s businesses are regulated and include the company’s profit margin.

Of 14 analysts covering the stock, six have a Buy or Strong Buy rating and six more rate the stock at Hold. At a recent price of around $13.55 a share, the implied gain based on a median price target of $16.75 is nearly 23.6%. Based on the high price target of $20.00, the upside potential for the stock is about 47.6%.

Analysts expect the company to report first-quarter revenue of $709.61 million, which would be up 19.3% sequentially and 11.8% higher year over year. Adjusted earnings per share (EPS) are expected to come in at $0.21, down 0.1% sequentially but up by 5.0% year over year. For the full 2022 fiscal year, Algonquin is expected to post EPS of $0.74, up 4.5%, on revenue of $2.75 billion, up 20.1%.

The company’s stock trades at 18.3 times expected 2022 earnings, 16.8 times estimated 2023 earnings of $0.81 per share and 15.9 times estimated 2024 earnings of $0.85 per share. The stock’s 52-week range is $13.38 to $16.25. Algonquin pays an annual dividend of $0.68 (yield of 5.04%). Total shareholder return for the past year was negative 10.7%.

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