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FirstEnergy Goes Negative

By Seth Jayson – Updated Apr 10, 2017 at 2:17PM

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Just the facts, Fool.

FirstEnergy (NYSE: FE) reported earnings on Feb. 25. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), FirstEnergy whiffed on revenues and met expectations on earnings per share.

Compared to the prior-year quarter, revenue dropped. Non-GAAP earnings per share expanded. GAAP earnings per share contracted to a loss.

Margins dropped across the board.

Revenue details
FirstEnergy logged revenue of $3.50 billion. The three analysts polled by S&P Capital IQ expected revenue of $4.85 billion on the same basis. GAAP reported sales were 7.6% lower than the prior-year quarter's $3.79 billion.

Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
EPS came in at $0.80. The 13 earnings estimates compiled by S&P Capital IQ predicted $0.80 per share. Non-GAAP EPS of $0.80 for Q4 were 3.9% higher than the prior-year quarter's $0.77 per share. GAAP EPS were -$0.35 for Q4 compared to $0.34 per share for the prior-year quarter.

Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 55.0%, 20 basis points worse than the prior-year quarter. Operating margin was -1.0%, 750 basis points worse than the prior-year quarter. Net margin was -4.2%, 800 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $4.09 billion. On the bottom line, the average EPS estimate is $0.73.

Next year's average estimate for revenue is $16.12 billion. The average EPS estimate is $2.98.

Investor sentiment
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 362 members out of 383 rating the stock outperform, and 21 members rating it underperform. Among 89 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 81 give FirstEnergy a green thumbs-up, and eight give it a red thumbs-down.

Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on FirstEnergy is hold, with an average price target of $44.94.

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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Stocks Mentioned

FirstEnergy Stock Quote
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