Benzinga | Jan 20, 2021 10:17AM EST

Earnings Preview for Union Pacific

Union Pacific (NYSE:UNP) announces its next round of earnings this Thursday, January 21. Here is Benzinga's look at Union Pacific's Q4 earnings report.

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

Union Pacific EPS is expected to be around $2.23, according to sell-side analysts. Sales will likely be near $5.09 billion. In the same quarter last year, Union Pacific reported EPS of $2.02 on revenue of $5.21 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 analyst consensus estimate would represent a 10.4% increase in the company's EPS figure. Sales would be down 2.34% from the same quarter last year. Union Pacific's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 2.05 1.52 1.90 2.06EPS Actual 2.01 1.67 2.15 2.02Revenue Estimate 4.96 B 4.37 B 5.08 B 5.27 BRevenue Actual 4.92 B 4.24 B 5.23 B 5.21 B

Stock Performance

Shares of Union Pacific were trading at $215.22 as of January 19. Over the last 52-week period, shares are up 15.82%. Given that these returns are generally positive, long-term shareholders are probably happy going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Union Pacific is scheduled to hold the call at 08:45:00 ET and can be accessed here.