Preview: Shell Midstream Partners's Earnings

Shell Midstream Partners SHLX announces its next round of earnings this Friday, April 30. Here is Benzinga's look at Shell Midstream Partners's Q1 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

Shell Midstream Partners EPS will likely be near $0.35 while revenue will be around $126.92 million, according to analysts. In the same quarter last year, Shell Midstream Partners reported EPS of $0.36 on revenue of $121.00 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.

If the company were to post earnings in line with the consensus estimate when it reports Friday, EPS would be down 2.78%. Revenue would be up 4.89% on a year-over-year basis. Shell Midstream Partners's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Shell Midstream Partners were trading at $15.795 as of April 28. Over the last 52-week period, shares are up 23.93%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Shell Midstream Partners is scheduled to hold the call at 11:00:00 ET and can be accessed here.