Conformis's Earnings: A Preview

Conformis CFMS unveils its next round of earnings this Wednesday, May 05. Here is Benzinga's everything-that-matters guide for the 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 expects an EPS loss of $0.07 and sales around $13.77 million. Conformis reported a per-share loss of $0.14 when it published results during the same quarter last year. Sales in that period totaled $16.48 million.

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 Wednesday, EPS would be up 50.0%. Sales would have fallen 16.42% from the same quarter last year. Conformis's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Conformis were trading at $0.9359 as of May 03. Over the last 52-week period, shares are down 9.65%. Given that these returns are generally negative, long-term shareholders are likely a little upset going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Conformis is scheduled to hold the call at 16:30:00 ET and can be accessed here.