Preview: Cabot's Earnings

On Monday, May 03, Cabot CBT will report its last quarter's earnings. Here is Benzinga's preview of the company's release.

What Are Earnings, Net Income, 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

Based on Cabot management projections, analysts predict EPS of $0.97 on revenue of $787.67 million. In the same quarter last year, Cabot reported EPS of $0.77 on revenue of $710.00 million.

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.

If the company were to report earnings in line when it publishes results Monday, quarterly profit would be up 25.97%. Revenue would be up 10.94% from the same quarter last year. Here is how the company's reported EPS has compared to analyst estimates in the past:

Stock Performance

For a full 12 months, the return has risen by 78.97%. 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. Cabot is scheduled to hold the call at 08:00:00 ET and can be accessed here.