Benzinga | Feb 22, 2021 10:21AM EST

Preview: Jazz Pharmaceuticals's Earnings

Jazz Pharmaceuticals (NASDAQ:JAZZ) releases its next round of earnings this Tuesday, February 23. Here is Benzinga's essential guide to Jazz Pharmaceuticals's Q4 earnings report.

What Are Earnings, Net Income, 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

Analysts predict Jazz Pharmaceuticals will report earnings of $4.2 per share on revenue of $639.55 million. In the same quarter last year, Jazz Pharmaceuticals reported EPS of $4.42 on revenue of $581.74 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 Wall Street estimate would represent a 4.98% decline in the company's earnings. Sales would be up 9.94% 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 4.08 3.11 0.67 4.12EPS Actual 4.31 3.71 0.45 4.42Revenue Estimate 577.58 M 504.65 M 543.59 M 561.69 MRevenue Actual 600.89 M 562.44 M 534.73 M 581.74 M

Stock Performance

Shares of Jazz Pharmaceuticals were trading at $160.6 as of February 19. Over the last 52-week period, shares are up 26.33%. 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. Jazz Pharmaceuticals is scheduled to hold the call at 16:30:00 ET and can be accessed here.