Earnings Preview: Elastic

On Wednesday, June 02, Elastic ESTC will release its latest earnings report. Decipher the announcement with Benzinga's help.

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

Wall Street analysts see Elastic reporting a quarterly loss of $0.16 per share on sales of $158.91 million. Elastic reported a per-share loss of $0.12 when it published results during the same quarter last year. Sales in that period totaled $123.62 million.

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 Wall Street consensus estimate for earnings would represent a 33.33% decrease for the company. Revenue would be up 28.54% from the same quarter last year. Here is how the Elastic's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

For a full 12 months, the return has risen by 34.27%. Given that these returns are generally positive, long-term shareholders are probably relaxed going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.

Do not be surprised to see the stock move on comments made during its conference call. Elastic is scheduled to hold the call at 17:00:00 ET and can be accessed here.