Benzinga | Jan 27, 2021 10:15AM EST

ResMed's Earnings Outlook

On Thursday, January 28, ResMed (NYSE:RMD) will release its latest earnings report. Decipher the announcement with Benzinga's help.

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

Analysts predict ResMed will report earnings of $1.26 per share on revenue of $783.18 million. ResMed earnings in the same period a year ago was $1.21 per share. Quarterly sales came in at $736.16 million.

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 4.13% increase in the company's EPS figure. Sales would be up 6.39% from the year-ago period. ResMed's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q1 2020 Q4 2020 Q3 2020 Q2 2020EPS Estimate 0.99 1.08 1.03 1.03EPS Actual 1.27 1.33 1.29 1.21Revenue Estimate 699.03 M 746.90 M 719.57 M 731.58 MRevenue Actual 751.94 M 770.34 M 769.46 M 736.16 M

Stock Performance

Shares of ResMed were trading at $222.32 as of January 26. Over the last 52-week period, shares are up 31.82%. Given that these returns are generally positive, long-term shareholders are probably content going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. ResMed is scheduled to hold the call at 16:30:00 ET and can be accessed here.