Benzinga | Feb 24, 2021 10:08AM EST

Assured Guaranty Earnings Preview

On Thursday, February 25, Assured Guaranty (NYSE:AGO) 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

Based on management's projections, Assured Guaranty analysts model for earnings of $0.61 per share on sales of $187.80 million. Assured Guaranty EPS in the same period a year ago totaled $0.9. Revenue was $123.00 million.

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.

If the company were to post earnings in line with the consensus estimate when it reports Thursday, EPS would be down 32.22%. Sales would be have grown 52.68% 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 0.66 0.69 0.76 0.78EPS Actual 0.58 1.36 0.36 0.90Revenue Estimate 193.50 M 215.20 M 218.00 M 204.00 MRevenue Actual 107.00 M 121.00 M 103.00 M 123.00 M

Stock Performance

For a full 12 months, the return has risen by 4.82%. Given that these returns are generally positive, long-term shareholders are probably relaxed going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

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