Northern Trust Earnings Preview

On Tuesday, April 20, Northern Trust NTRS will release its latest earnings report. Benzinga's report can help you figure out the ins and outs of the earnings release.

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

Wall Street analysts see Northern Trust reporting earnings of $1.48 per share on sales of $1.54 billion. In the same quarter last year, Northern Trust reported EPS of $1.55 on revenue of $1.59 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 post earnings in line with the consensus estimate when it reports Tuesday, EPS would be down 4.52%. Sales would be down 3.02% from the year-ago period. Northern Trust's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Over the last 52-week period, shares are up 43.65%. 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. Northern Trust is scheduled to hold the call at 09:00:00 ET and can be accessed here.