Preview: Despegar.com's Earnings

Despegar.com DESP announces its next round of earnings this Wednesday, May 19. Here is Benzinga's everything-that-matters guide for this Wednesday's Q1 earnings announcement.

Net Income, Earnings, And Earnings Per Share

Earnings and EPS are useful metrics of profitability. Total earnings also known as net income is equal to total revenue minus total expenses. Dividing net income by the total number of shares outstanding yields EPS.

Earnings And Revenue

Despegar.com EPS will likely be near $0.28 while revenue will be around $54.47 million, according to analysts. In the same quarter last year, Despegar.com reported a loss per share of $0.01 on sales of $76.08 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 Wall Street estimate would represent a 2700.0% decline in the company's earnings. Revenue would be down 28.41% from the year-ago period. Despegar.com's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Despegar.com were trading at $12.69 as of May 17. Over the last 52-week period, shares are up 102.38%. Given that these returns are generally positive, long-term shareholders are probably content going into this earnings release.

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