Earnings Preview: Sandvik

Sandvik SDVKY releases its next round of earnings this Friday, July 16. Get the latest predictions in Benzinga's essential guide to the company's Q2 earnings report.

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

Analysts predict Sandvik will report earnings of $0.31 per share on revenue of $2.72 billion. In the same quarter last year, Sandvik reported earnings per share of $0.18 on sales of $2.09 billion.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

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 72.22% increase for the company. Revenue would be up 30.14% from the year-ago period. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Stock Performance

Shares of Sandvik were trading at $26.91 as of July 14. Over the last 52-week period, shares are up 35.25%. Given that these returns are generally positive, long-term shareholders are probably satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Sandvik is scheduled to hold the call at 05:30:00 ET and can be accessed here.