Benzinga | Oct 30, 2020 11:12AM EDT

A Preview Of Premier's Earnings

Premier (NASDAQ: PINC) releases its next round of earnings this Monday, November 02. Here is Benzinga's essential guide to Premier's Q1 earnings report.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.

Earnings And Revenue

Analysts covering Premier modeled for quarterly EPS of $0.49 on revenue of $305.01 million. Premier EPS in the same period a year ago totaled $0.68. Sales were $302.41 million.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

Wall Street analysts who study this company will publish analyst estimates of revenue and EPS. The averages of all analyst EPS and revenue estimates are called the "consensus estimates"; these consensus estimates can have a significant effect on a company's performance during an earnings release. When a company posts earnings or revenue above or below a consensus estimate, it has posted an "earnings surprise", which can really move a stock depending on the difference between actual and estimated values.

If the company were to match the consensus estimate when it reports Monday, earnings would be down 27.94%. Sales would be up 0.86% from the same quarter last year. Here is how the Premier's reported EPS has stacked up against analyst estimates in the past:

Quarter Q4 2020 Q3 2020 Q2 2020 Q1 2019EPS Estimate 0.61 0.71 0.68 0.66EPS Actual 0.58 0.73 0.74 0.68Revenue Estimate 314.36 M 313.46 M 308.29 M 296.14 MRevenue Actual 342.75 M 334.82 M 319.61 M 302.41 M

Stock Performance

Shares of Premier were trading at $32.42 as of October 29. Over the last 52-week period, shares are down 2.6%. Given that these returns are generally negative, long-term shareholders are likely a little upset going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Premier is scheduled to hold the call at 17:00:00 ET and can be accessed here.