A Preview Of GMS's Earnings

On Thursday, June 24, GMS GMS will release its latest earnings report. Decipher the announcement with Benzinga's help.

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

GMS EPS is expected to be around $0.82, according to sell-side analysts. Sales will likely be near $858.90 million. GMS reported a per-share profit of $0.56 when it published results during the same quarter last year. Sales in that period totaled $770.85 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 Thursday, EPS would be up 46.43%. Revenue would be up 11.42% from the same quarter last year. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

Shares of GMS were trading at $42.3 as of June 22. Over the last 52-week period, shares are up 75.42%. Given that these returns are generally positive, long-term shareholders can be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. GMS is scheduled to hold the call at 08:30:00 ET and can be accessed here.