Wall Street expects Thursday to mark the start of strong third-quarter earnings from smart energy-management companies.
Energy-management technologies help utilities and consumers ease the electric grid's strain and prevent blackouts.
Many investors will pay especially close attention to Itron, which makes smart meters and meter-reading systems and will announce how it did after the market closes Thursday.
"Itron is probably the bellwether of the group," said John Quealy, an analyst at financial-service firm Canaccord Adams, which has previously done business with Itron. The company has about 60 percent of the market share for smart meters today, said Quealy, who expects the company to retain market share as the market grows.
And if things go as Lazard Capital Markets analysts expect, Itron (NSDAQ: ITRI) will post another solid quarter.
The firm expects Itron to reach $430 million in revenues -- and earnings per share to reach 70 cents -- as opposed to market consensus of $444.3 million in sales and 77 cents per share.
During the same quarter last year, Itron bagged $164.7 million in sales and posted earnings of 63 cents per share.
Other energy-management companies that will help add color to the snapshot of how the industry is doing include Comverge (NSDQ: COMV), which is expected to announce earnings Nov. 13, and EnerNOC (NSDAQ: ENOC), which posted earnings Thursday.
The company reported a third-quarter net loss of $2.5 million, or $0.14 per share, beating analyst expectations of a loss of 24 cents per share. EnerNOC's shares grew $1.40, or 3 percent, to $48 per share on the news.
A growing global demand for power -- expected to increase by as much as 60 percent during the next 20 years -- is driving investor interest in the sector.
Energy-management technology could play a key role in getting the most out of the power plants already in place.
And it's still early in the sector's development. Quealy said companies are buying advanced metering equipment in anticipation of new developments, such as electric prices based on the time electricity is used.
California, Texas, Michigan and the Canadian province of Ontario are among the areas considering such time-of-use pricing programs, which would boost the market for smart meters and other energy management, he said.
"This is just the first inning of the build-out of the smart grid," Quealy said.
Some evidence of growth could be big companies coming onto the scene.
For example, titan General Electric is developing a control panel that allows homeowners to curb rising utility bills by helping manage power and water consumption, according to a Reuters story Tuesday.
The story said the "eco-dashboard" will be available in December in select areas.
And industrial-supplies giant Honeywell also has gotten into the game with a new smart thermostat, Quealy said.
"Some of the big guys are starting to awaken to this now," he said. "It shows that energy efficiency really is starting to ramp up."
Still, Quealy said he doesn't expect the entrance of the giants will squash smaller companies.
That's good news for companies like Lucid Design Group, which Monday won an award in the California Clean Tech Open (see California Clean Tech Open Winners Score Cash, Services); Optimal Technologies International, which Tuesday raised $25 million (see Optimal Technologies Nabs $25M for Energy Management); GridPoint, which raised $32 million in September; and Grid Net, which raised $6.75 million in its first round (see GridPoint Raises $32M, With More to Come).
Interest from larger companies could even be a potential exit for some of the startups in the future (see Energy-Management Consolidation Continues).