Preview: Qurate Retail's Earnings

On Friday, May 07, Qurate Retail QRTEA will release its latest earnings report. Check out Benzinga's preview to understand the implications.

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

Sell-side analysts expect Qurate Retail's EPS to be near $0.33 on sales of $3.14 billion. In the same quarter last year, Qurate Retail reported EPS of $0.27 on revenue of $2.92 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.

The Wall Street estimate would represent a 22.22% increase in the company's earnings. Revenue would be up 7.53% from the year-ago period. Qurate Retail's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Qurate Retail were trading at $11.78 as of May 05. Over the last 52-week period, shares are up 39.87%. 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. Qurate Retail is scheduled to hold the call at 08:30:00 ET and can be accessed here.