Benzinga | Mar 10, 2021 10:12AM EST

DocuSign's Earnings Outlook

DocuSign (NASDAQ:DOCU) releases its next round of earnings this Thursday, March 11. Here is Benzinga's essential guide to DocuSign's Q4 earnings report.

Net Income, Earnings, 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

Sell-side analysts expect DocuSign's EPS to be near $0.22 on sales of $407.65 million. In the same quarter last year, DocuSign reported earnings per share of $0.12 on revenue of $274.89 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.

The Wall Street estimate would represent a 83.33% increase in the company's earnings. Sales would be up 48.29% on a year-over-year basis. DocuSign's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 0.13 0.08 0.10 0.05EPS Actual 0.22 0.17 0.12 0.12Revenue Estimate 361.15 M 318.57 M 280.93 M 266.49 MRevenue Actual 382.92 M 342.21 M 297.02 M 274.89 M

Stock Performance

Shares of DocuSign were trading at $213.22 as of March 09. Over the last 52-week period, shares are up 217.62%. Given that these returns are generally positive, long-term shareholders are probably content going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. DocuSign is scheduled to hold the call at 16:30:00 ET and can be accessed here.