Benzinga | Feb 15, 2021 10:39AM EST

A Preview Of Advance Auto Parts's Earnings

On Tuesday, February 16, Advance Auto Parts (NYSE:AAP) will report its last quarter's earnings. Here is Benzinga's preview of the company's release.

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 analysts see Advance Auto Parts reporting earnings of $1.97 per share on revenue of $2.36 billion. In the same quarter last year, Advance Auto Parts reported earnings per share of $1.64 on sales of $2.11 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 20.12% increase in the company's EPS figure. Sales would be up 11.69% from the year-ago period. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 2.66 1.98 1.75 1.36EPS Actual 2.81 2.92 0.91 1.64Revenue Estimate 2.48 B 2.38 B 2.74 B 2.12 BRevenue Actual 2.54 B 2.50 B 2.70 B 2.11 B

Stock Performance

Over the last 52-week period, shares of Advance Auto Parts are up 7.76%.

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