Benzinga | Feb 16, 2021 10:23AM EST

A Preview Of SM Energy's Earnings

SM Energy (NYSE:SM) announces its next round of earnings this Wednesday, February 17. Here is Benzinga's everything-that-matters guide for this Wednesday's Q4 earnings announcement.

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 expects EPS of $0.05 and sales around $342.32 million. SM Energy reported a per-share loss of $0.04 when it published results during the same quarter last year. Sales in that period totaled $451.69 million.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

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.

If the company were to match the consensus estimate, earnings would be up 225.0%. Sales would have fallen 24.21% from the same quarter last year. SM Energy's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate -0.28 -0.50 -0.17 -0.04EPS Actual -0.05 -0.15 -0.05 -0.04Revenue Estimate 309.91 M 291.27 M 401.34 M 417.13 MRevenue Actual 281.01 M 169.63 M 355.73 M 451.69 M

Stock Performance

Shares of SM Energy were trading at $12.7 as of February 15. Over the last 52-week period, shares are up 44.44%. Given that these returns are generally positive, long-term shareholders are probably satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. SM Energy is scheduled to hold the call at 10:00:00 ET and can be accessed here.