First American Financial FAF will be releasing its next round of earnings this Thursday, April 22. For all of the relevant information, here is your guide for Thursday's Q1 earnings announcement.
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 First American Financial reporting earnings of $1.33 per share on revenue of $1.79 billion. First American Financial reported a per-share profit of $1.06 when it published results during the same quarter last year. Sales in that period totaled $1.41 billion.
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.
If the company were to report earnings in line when it publishes results Thursday, earnings would be up 25.47%. Sales would be up 26.68% from the same quarter last year. Here is how the company's EPS has stacked up against analyst estimates in the past:
| Quarter | Q1 2021 | Q4 2021 | Q3 2020 | Q2 2020 |
|---|---|---|---|---|
| EPS Estimate | 1.33 | 1.72 | 1.27 | 0.75 |
| EPS Actual | 1.64 | 2.11 | 1.31 | 1.05 |
| Revenue Estimate | 1.79 B | 1.86 B | 1.64 B | 1.30 B |
| Revenue Actual | 2.03 B | 2.20 B | 1.91 B | 1.61 B |
Stock Performance
Shares of First American Financial were trading at $66.01 as of June 11. Over the last 52-week period, shares are up 29.38%. 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. First American Financial is scheduled to hold the call at 11:00:00 ET and can be accessed here.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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