AES Stock Slides on Weak Earnings Guidance
NEW YORK (TheStreet) -- AES Corp. (AES) - Get Report stock is retreating 7.49% to $10.01 in afternoon trading on Thursday after the company reduced its 2015 earnings guidance and set its 2016 earnings guidance below estimates.
Before the market open this morning, the electricity producer and distributor lowered its 2015 earnings guidance to $1.18 to $1.25 per share from the previous outlook of $1.25 to $1.35 per share.
AES set its 2016 earnings guidance at $1.05 to $1.15 per share representing a year-over-year decline because of unfavorable exchange rates, volatile commodities prices and weak demand in Brazil.
Analysts had estimated earnings of $1.27 per share for 2015 and $1.30 per share for 2016.
"We are obviously disappointed with the impact of global macroeconomic factors on our outlook," CEO Andrés Gluski said in a statement.
"Accordingly, we are launching $150 million in cost reduction and revenue enhancement initiatives that will offset the majority of these headwinds by 2018," Gluski added.
Additionally, AES posted earnings of 39 cents per share for the 2015 third quarter, beating estimates by 3 cents.
Revenue totaled $3.72 billion for the quarter ended September 30, missing estimates of $5.29 billion.
Separately, TheStreet Ratings team rates AES CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
We rate AES CORP (AES) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. Among the primary strengths of the company is its respectable return on equity which we feel is likely to continue. At the same time, however, we also find weaknesses including unimpressive growth in net income, generally higher debt management risk and a generally disappointing performance in the stock itself.
You can view the full analysis from the report here: AES
data by
Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of Jim Cramer, TheStreet or any of its contributors.