NSTAR Earnings Preview

Investors never know what to expect for NSTAR (NYSE: NST), as it has wavered between topping and missing analysts estimates during the past fiscal year. The company will unveil its latest earnings on Friday, Nov. 4. NSTAR is a holding company which is engaged, through its subsidiaries, in the energy delivery business.

What analysts say:

• Buy, sell, or hold?: Analysts think investors should stand pat on NSTAR with five of eight analysts rating it hold. Analysts don't like NSTAR as much as competitor Northeast Utilities System overall. Four out of 12 analysts rate Northeast Utilities System a buy compared to two of eight for NSTAR. NSTAR's rating hasn't changed over the past three months.
• Revenue Forecasts: On average, analysts predict $772 million in revenue this quarter. That would represent a decline of 3.2% from the year-ago quarter.
• Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.93 per share. Estimates range from $0.92 to $0.94.

What our community says:
CAPS All-Stars are solidly behind the stock with 100% assigning it an "outperform" rating. The community at large concurs with the All-Stars with 95.7% giving it a rating of "outperform." Fools are keen on NSTAR, though the message boards have been quiet lately with only 38 posts in the past 30 days. Even with a robust four out of five stars, NSTAR's CAPS rating falls a little short of the community's upbeat outlook.

Management:
NSTAR's income has fallen year over year by an average of 21.3% over the past five quarters. A year-over-year revenue decrease last quarter snaps a streak of three consecutive quarters of revenue increases.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross and net margins over the past four quarters.

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