Sherwin-Williams SHW will be releasing its next round of earnings this Tuesday, July 27. For all of the relevant information, here is your guide for Tuesday's Q2 earnings announcement.
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
Wall Street expects EPS of $2.67 and sales around $5.38 billion. In the same quarter last year, Sherwin-Williams reported EPS of $7.1 on revenue of $4.60 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.
If the company were to match the consensus estimate when it reports Tuesday, earnings would be down 62.39%. Revenue would be up 16.85% from the year-ago period. Here is how the company's reported EPS has stacked up against analyst estimates in the past:
| Quarter | Q1 2021 | Q4 2020 | Q3 2020 | Q2 2020 |
|---|---|---|---|---|
| EPS Estimate | 1.64 | 4.85 | 7.75 | 5.77 |
| EPS Actual | 2.06 | 5.09 | 8.29 | 7.10 |
| Revenue Estimate | 4.51 B | 4.34 B | 5.08 B | 4.53 B |
| Revenue Actual | 4.66 B | 4.49 B | 5.12 B | 4.60 B |
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Stock Performance
Over the last 52-week period, shares are up 34.73%. Given that these returns are generally positive, long-term shareholders can relax 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. Sherwin-Williams 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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