Benzinga | Jan 21, 2021 10:06AM EST

Schlumberger's Earnings: A Preview

On Friday, January 22, Schlumberger (NYSE:SLB) will release its latest earnings report. Here is Benzinga's outlook for the company.

Net Income, Earnings, 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

Schlumberger earnings will be near $0.17 per share on sales of $5.25 billion, according to analysts. In the same quarter last year, Schlumberger posted EPS of $0.39 on sales of $8.23 billion.

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.

The Wall Street estimate would represent a 56.41% decline in the company's earnings. Revenue would be down 36.19% on a year-over-year basis. Here is how the company's reported EPS has compared to analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 0.12 -0.01 0.24 0.37EPS Actual 0.16 0.05 0.25 0.39Revenue Estimate 5.38 B 5.40 B 7.52 B 8.15 BRevenue Actual 5.26 B 5.36 B 7.46 B 8.23 B

Stock Performance

Shares of Schlumberger were trading at $25.35 as of January 20. Over the last 52-week period, shares are down 29.75%. Given that these returns are generally negative, long-term shareholders are likely unhappy going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Schlumberger is scheduled to hold the call at 08:30:00 ET and can be accessed here.