Benzinga | Oct 29, 2020 10:07AM EDT

Booz Allen Hamilton Earnings Preview

Booz Allen Hamilton (NYSE: BAH) announces its next round of earnings this Friday, October 30. Here is Benzinga's everything-that-matters guide for this Friday's Q2 earnings announcement.

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

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Wall Street expects EPS of $0.92 and sales around $1.97 billion. In the same quarter last year, Booz Allen Hamilton posted EPS of $0.81 on sales of $1.82 billion.

Why Analyst Estimates And Earnings Surprises Are Important

Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.

The Wall Street estimate would represent a 13.58% increase in the company's earnings. Sales would be up 8.24% from the year-ago period. Booz Allen Hamilton's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q1 2020 Q4 2020 Q3 2020 Q2 2019EPS Estimate 0.86 0.69 0.76 0.72EPS Actual 0.93 0.73 0.80 0.81Revenue Estimate 1.97 B 1.94 B 1.82 B 1.78 BRevenue Actual 1.96 B 1.97 B 1.85 B 1.82 B

Stock Performance

Shares of Booz Allen Hamilton were trading at $74.6 as of October 28. Over the last 52-week period, shares are up 0.83%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Booz Allen Hamilton is scheduled to hold the call at 08:00:00 ET and can be accessed here.