Public Service Enterprise Group Incorporated Just Missed Earnings - But Analysts Have Updated Their Models

The analysts might have been a bit too bullish on Public Service Enterprise Group Incorporated (NYSE:PEG), given that the company fell short of expectations when it released its first-quarter results last week. Public Service Enterprise Group missed earnings this time around, with US$2.8b revenue coming in 8.8% below what the analysts had modelled. Statutory earnings per share (EPS) of US$1.06 also fell short of expectations by 16%. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. With this in mind, we've gathered the latest statutory forecasts to see what the analysts are expecting for next year.

See our latest analysis for Public Service Enterprise Group

Taking into account the latest results, the current consensus from Public Service Enterprise Group's 15 analysts is for revenues of US$10.8b in 2024. This would reflect an okay 5.7% increase on its revenue over the past 12 months. Statutory per share are forecast to be US$3.68, approximately in line with the last 12 months. Yet prior to the latest earnings, the analysts had been anticipated revenues of US$10.6b and earnings per share (EPS) of US$3.68 in 2024. So it looks like there's been no major change in sentiment following the latest results, although the analysts have made a slight bump in to revenue forecasts.

Even though revenue forecasts increased, there was no change to the consensus price target of US$68.91, suggesting the analysts are focused on earnings as the driver of value creation. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Public Service Enterprise Group analyst has a price target of US$77.00 per share, while the most pessimistic values it at US$61.50. This is a very narrow spread of estimates, implying either that Public Service Enterprise Group is an easy company to value, or - more likely - the analysts are relying heavily on some key assumptions.

Another way we can view these estimates is in the context of the bigger picture, such as how the forecasts stack up against past performance, and whether forecasts are more or less bullish relative to other companies in the industry. The analysts are definitely expecting Public Service Enterprise Group's growth to accelerate, with the forecast 7.7% annualised growth to the end of 2024 ranking favourably alongside historical growth of 2.3% per annum over the past five years. Compare this with other companies in the same industry, which are forecast to grow their revenue 4.4% annually. Factoring in the forecast acceleration in revenue, it's pretty clear that Public Service Enterprise Group is expected to grow much faster than its industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. Pleasantly, they also upgraded their revenue estimates, and their forecasts suggest the business is expected to grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

With that in mind, we wouldn't be too quick to come to a conclusion on Public Service Enterprise Group. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Public Service Enterprise Group going out to 2026, and you can see them free on our platform here..

That said, it's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with Public Service Enterprise Group (at least 1 which is a bit unpleasant) , and understanding these should be part of your investment process.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.