Benzinga | Apr 15, 2021 10:25AM EDT

Earnings Outlook For State Street

State Street (NYSE:STT) announces its next round of earnings this Friday, April 16. Here is Benzinga's everything-that-matters guide for this Friday's Q1 earnings announcement.

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 State Street reporting earnings of $1.35 per share on revenue of $2.87 billion. In the same quarter last year, State Street announced EPS of $1.67 on revenue of $3.06 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.

If the company were to post earnings in line with the consensus estimate when it reports Friday, EPS would be down 19.16%. Revenue would be down 6.36% from the same quarter last year. The company's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q4 2021 Q3 2020 Q2 2020 Q1 2020EPS Estimate 1.56 1.41 1.61 1.35EPS Actual 1.69 1.45 1.88 1.67Revenue Estimate 2.82 B 2.77 B 2.87 B 2.90 BRevenue Actual 2.92 B 2.78 B 2.94 B 3.06 B

Stock Performance

Shares of State Street were trading at $86.72 as of April 14. Over the last 52-week period, shares are up 47.37%. 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. State Street is scheduled to hold the call at 10:00:00 ET and can be accessed here.