XEL

Xcel Energy (XEL) is positioned as a likely earnings beat candidate for Q3 2026 with a positive Earnings ESP of +2.96% and Zacks Rank #3. The company is expected to report quarterly EPS of $1.35 (up 8.9% YoY) and revenues of $4.13 billion (up 5.6% YoY) on October 29. While consensus estimates have been revised 2.86% lower in the last 30 days, recent analyst revisions suggest bullish sentiment on earnings prospects.

The article explains how investors can use the Zacks Earnings ESP (Expected Surprise Prediction) tool to identify stocks likely to beat earnings expectations. It highlights that combining positive ESP with a Zacks Rank #3 or better has historically resulted in positive earnings surprises 70% of the time with 28.3% average annual returns. Two utilities stocks are featured as examples: NextEra Energy and Xcel Energy, both with positive ESP figures ahead of their October earnings releases.

Zacks highlights two utility stocks with positive Earnings Surprise Prediction (ESP) metrics that could potentially beat upcoming earnings expectations. Xcel Energy (XEL) has a +1.50% ESP with a #3 Hold rating, while Entergy (ETR) has a +4.59% ESP with a #2 Buy rating. Both stocks are positioned to potentially deliver earnings surprises based on recent analyst revisions.

Xcel Energy agreed to sell its Michigan natural gas and electric operations, expected to close in 2027. The company plans a $60 billion investment through 2030 targeting 11% annual rate base growth and 6-8% EPS growth, supported by rising data center demand driving nearly 5% annual retail electricity sales growth.

Xcel Energy is capitalizing on rising electricity demand from data centers, manufacturing, and electrification. The company expects 3% weather-adjusted electric sales growth in 2026, with a strong large-load pipeline exceeding 20 GW. XEL plans $70 billion in capital investments through 2030 and targets 6-8% long-term earnings growth, supported by expanding infrastructure and rate-base expansion.

PPL Corporation and Xcel Energy are compared as investment opportunities in the utility sector. Both companies are investing heavily in infrastructure and clean energy transition.

PPL offers a higher dividend yield (3.6% vs 3.4%), lower debt-to-capital ratio (57.46% vs 62.12%), and slightly cheaper valuation (15.52X vs 15.75X P/E), making it the more compelling choice despite XEL's stronger ROE (10.65% vs 9.33%). Both stocks carry a Zacks Rank #3 (Hold).

NextEra Energy (NEE) reported Q3 adjusted EPS of $1.24, beating consensus estimates by 3.3%, driven by strong performance from Florida Power & Light and NextEra Energy Resources. The company added 3.7 GW to its renewables backlog and maintained its 2026 EPS guidance of $3.92-$4.02.

However, total revenues missed expectations. NEE continues advancing its pending merger with Dominion Energy, expected to close in H2 2027.

Alliant Energy (LNT) is leveraging a diversified generation mix of natural gas, wind, coal, solar, and hydropower to support reliability and growth. The company plans to invest $13.4 billion from 2026-2029 in new capacity, targeting 5-7% EPS growth. LNT's balanced portfolio helps manage fuel price volatility and grid reliability while meeting rising electricity demand from data centers.

PPL Corporation plans $23 billion in capital spending through 2029 targeting 6-8% annual earnings growth, supported by strong data center demand in Pennsylvania (31.8 GW) and Kentucky (13.7 GW pipeline). The company targets $175M in O&M savings by 2026 and 6-8% annual dividend growth through 2028. Despite trading at a premium valuation (P/E 15.83X vs industry 13.63X), PPL's lower debt-to-capital ratio (57.46%), rising earnings estimates, and consistent shareholder returns make it an attractive entry point following recent 9.2% share price decline.

IDACORP (IDA) is investing $7.1 billion through 2030 to expand generation capacity, battery storage, and transmission infrastructure. The company expects 2026 capital expenditures of $1.3-$1.5 billion and earnings of $6.30-$6.45 per share.

Customer count grew 2.3% year-over-year with industrial revenues up 17%, driven by rising electricity demand. IDA's debt-to-capital ratio of 50.08% is lower than the industry average of 62.33%.