PPL to Report Q3 Earnings: What's in Store for the Stock this Season?

PPL Corporation PPL is expected to report third-quarter 2025 results on Nov. 5, before market open. 

The Zacks Consensus Estimate for earnings is pegged at 46 cents per share, indicating year over year increase of 9.52%. The consensus mark for revenues is pinned at $2.17 billion, indicating growth of 5.14% from the year-ago reported figure.

PPL’s Earnings Surprise History

PPL’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and missed in other two, delivering a negative average surprise of 0.18%.

What Our Quantitative Model Predicts

Our proven model does not predict an earnings beat for PPL this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is not the case here as you will see below.

PPL Corporation Price and EPS Surprise

PPL Corporation price-eps-surprise | PPL Corporation Quote

Earnings ESP: The company’s Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Currently, PPL carries a Zacks Rank #4 (Sell). 

You can see the complete list of today's Zacks #1 Rank stocks here.

Stocks Worth a Look

Some stocks in the same industry that have the combination of factors indicating an earnings beat are Duke Energy Corporation DUK, Alliant Energy LNT and Brookfield Renewable Partners L.P. BEP. Duke Energy has a Zacks Rank #2 and an Earnings ESP of +1.63%. Alliant Energy has a Zacks Rank #3 and an Earnings ESP of +0.43%. Brookfield Renewable Partners has a Zacks Rank #3 and an Earnings ESP of +24.46%.

Key Factors Influencing PPL’s Third-Quarter Results

PPL’s quarterly earnings are likely to have continued to benefit from the ongoing cost reduction initiatives and energy efficiency programs designed to help customers. The expected return on capital investment in the second half of 2025 is likely to have boosted third-quarter earnings of the company.

PPL will also benefit from the strong load coming in from the data centers, as it has been making investment to upgrade transmission lines to cater to the rising demand from the data centers. Expected higher sales volume in the Pennsylvania and Kentucky regions is likely to have boosted quarterly earnings.

PPL Stock’s Price Performance

In the past three months, the stock has returned 1.8% compared with the industry’s growth of 1%.

PPL Stock Trading at a Premium

PPL is trading at a premium relative to the industry, with a forward 12-month price-to-earnings of 18.78X compared with the industry average of 15.27X.

PPL Stock Returns Lower Than Its Industry

Return on equity (“ROE”) is a financial ratio that measures how well a company uses its shareholders’ equity to generate profits. PPL’s trailing 12-month ROE is 8.81%, lower than the industry average of 10.35%.

Investment Consideration for PPL

PPL plans to invest $20 billion during 2025-2028 and capital investment for 2025 is expected to be $4.3 billion. Its strategic investments are focused on infrastructure construction projects for generation, transmission and distribution. Customers have been experiencing far fewer outages, courtesy to the company’s initiative to further strengthen its infrastructure.

PPL operates in a constructive regulatory jurisdiction. More than 60% of its capital investment plan is subject to contemporaneous recovery and this reduces the impact of regulatory lag on earnings for investments.

PPL is working on its “Utility of the Future” strategy and initiated an IT transformation effort to move to common systems. The company has also developed common design and operations standards across its utilities. This includes more robust engineering and construction specifications to strengthen and automate the grid to mitigate increasing weather and storm risks. These measures should increase the resilience of its services and enable the company to serve the rising demand from customers efficiently.

Rounding Up

PPL is expected to continue to benefit from rising demand in its service territories, cost savings initiatives, energy efficiency programs and investments in infrastructure upgrades to help serve customers more efficiently. Strong liquidity, grid upgrades and load growth driven by data center demand act as tailwinds for the company.

Yet, implementing its large-scale program demands meticulous management, as any delays, cost overruns or supply-chain challenges could negatively impact financial performance. Given PPL’s premium valuation and lower ROE, investors should exercise caution and consider staying on the sidelines for the time being.

 

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research