Principal Financial Group's Earnings: A Preview

On Thursday, January 28, Principal Financial Group PFG will release its latest earnings report. Here is Benzinga's outlook for the company.

Net Income, Earnings, 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

Principal Financial Group EPS will likely be near $1.42 while revenue will be around $3.86 billion, according to analysts. In the same quarter last year, Principal Financial Group posted EPS of $1.41 on sales of $4.19 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 0.71% increase in the company's EPS figure. Revenue would be down 7.79% from the same quarter last year. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

Shares of Principal Financial Group were trading at $52.37 as of January 26. Over the last 52-week period, shares are down 6.06%. Given that these returns are generally negative, long-term shareholders are probably upset going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Principal Financial Group is scheduled to hold the call at 10:00:00 ET and can be accessed here.