Benzinga | Feb 24, 2021 10:20AM EST

A Preview Of Carvana's Earnings

Carvana (NYSE:CVNA) releases its next round of earnings this Thursday, February 25. Get the latest predictions in Benzinga's essential guide to the company's Q4 earnings report.

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

Carvana EPS will likely be near $0.48 while revenue will be around $1.60 billion, according to analysts. In the same quarter last year, Carvana reported a loss per share of $0.79 on sales of $1.10 billion.

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.

The analyst consensus estimate would represent a 39.24% increase in the company's earnings. Revenue would be have grown 44.93% from the same quarter last year. The company's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate -0.33 -0.83 -0.63 -0.62EPS Actual -0.10 -0.62 -1.18 -0.79Revenue Estimate 1.53 B 1.14 B 1.14 B 1.10 BRevenue Actual 1.54 B 1.12 B 1.10 B 1.10 B

Stock Performance

Over the last 52-week period, shares of Carvana are up 209.0%.

Do not be surprised to see the stock move on comments made during its conference call. Carvana is scheduled to hold the call at 17:30:00 ET and can be accessed here.