Benzinga | Feb 16, 2021 10:25AM EST

Preview: Stamps.com's Earnings

On Wednesday, February 17, Stamps.com (NASDAQ:STMP) will release its latest earnings report. Here is Benzinga's outlook for the company.

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 Stamps.com reporting earnings of $2.62 per share on revenue of $194.26 million. Stamps.com EPS in the same period a year ago totaled $2.12. Revenue was $160.90 million.

Why Analyst Estimates And Earnings Surprises Are Important

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.

If the company were to report earnings in line when it publishes results Wednesday, quarterly profit would be up 23.58%. Revenue would be up 20.73% from the same quarter last year. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 1.53 1.13 0.97 1.03EPS Actual 3.83 3.11 1.32 2.12Revenue Estimate 163.53 M 146.03 M 133.39 M 144.68 MRevenue Actual 193.92 M 206.73 M 151.35 M 160.90 M

Stock Performance

Shares of Stamps.com were trading at $276.73 as of February 15. Over the last 52-week period, shares are up 194.76%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Stamps.com is scheduled to hold the call at 17:00:00 ET and can be accessed here.