A Preview Of Steel Dynamics's Earnings

Steel Dynamics STLD releases its next round of earnings this Monday, July 19. Here is Benzinga's essential guide to Steel Dynamics's Q2 earnings report.

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 Steel Dynamics management projections, analysts predict EPS of $3.42 on revenue of $4.22 billion. Steel Dynamics EPS in the same period a year ago totaled $0.47. Sales were $2.09 billion.

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 match the consensus estimate, earnings would be up 627.66%. Revenue would be up 101.53% on a year-over-year basis. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Stock Performance

Shares of Steel Dynamics were trading at $61.62 as of July 15. Over the last 52-week period, shares are up 131.27%. Given that these returns are generally positive, long-term shareholders are probably satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Steel Dynamics is scheduled to hold the call at 10:00:00 ET and can be accessed here.