Benzinga | Apr 21, 2021 10:54AM EDT

Union Pacific's Earnings: A Preview

On Thursday, April 22, Union Pacific (NYSE:UNP) will release its latest earnings report. Check out Benzinga's preview to understand the implications.

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 Union Pacific reporting earnings of $2.05 per share on sales of $5.03 billion. In the same quarter last year, Union Pacific announced EPS of $2.15 on revenue of $5.23 billion.

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 analyst consensus estimate would represent a 4.65% decrease in the company's earnings. Sales would be down 3.81% on a year-over-year basis. Union Pacific's reported EPS has stacked up against analyst estimates in the past like this:

Quarter Q4 2021 Q3 2020 Q2 2020 Q1 2020EPS Estimate 2.29 2.05 1.52 1.90EPS Actual 2.36 2.01 1.67 2.15Revenue Estimate 5.09 B 4.96 B 4.37 B 5.08 BRevenue Actual 5.14 B 4.92 B 4.24 B 5.23 B

Stock Performance

Shares of Union Pacific were trading at $220.65 as of April 20. Over the last 52-week period, shares are up 47.64%. Given that these returns are generally positive, long-term shareholders can be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Union Pacific is scheduled to hold the call at 08:45:00 ET and can be accessed here.