Benzinga | Feb 4, 2021 11:22AM EST

Preview: Aon's Earnings

Aon (NYSE:AON) unveils its next round of earnings this Friday, February 05. Here is Benzinga's everything-that-matters guide for the earnings announcement.

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

Based on Aon management projections, analysts predict EPS of $2.46 on revenue of $2.84 billion. In the same quarter last year, Aon reported EPS of $2.53 on revenue of $2.88 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 analyst consensus estimate would represent a 2.77% decline in the company's EPS figure. Sales would be down 1.56% from the year-ago period. Here is how the company's EPS has stacked up against analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 1.49 1.93 3.66 2.47EPS Actual 1.53 1.96 3.68 2.53Revenue Estimate 2.32 B 2.55 B 3.30 B 2.85 BRevenue Actual 2.38 B 2.50 B 3.22 B 2.88 B

Stock Performance

Over the past 52-week period, shares of Aon have declined 10.73%.

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