Innospec's Earnings Outlook

On Tuesday, May 04, Innospec IOSP will release its latest earnings report. Benzinga's report can help you figure out the ins and outs of the earnings release.

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

Based on Innospec management projections, analysts predict EPS of $0.98 on revenue of $306.20 million. In the same quarter last year, Innospec posted EPS of $1.42 on sales of $372.30 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 analyst consensus estimate would represent a 30.99% decrease in the company's earnings. Sales would be down 17.75% from the same quarter last year. The company's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Innospec were trading at $97.41 as of April 30. Over the last 52-week period, shares are up 40.42%. Given that these returns are generally positive, long-term shareholders are probably happy going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Innospec is scheduled to hold the call at 09:00:00 ET and can be accessed here.