Earnings Preview: Interpublic Gr of Cos

On Wednesday, July 21, Interpublic Gr of Cos IPG 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 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

Sell-side analysts expect Interpublic Gr of Cos's EPS to be near $0.42 on sales of $2.08 billion. Interpublic Gr of Cos EPS in the same period a year ago totaled $0.23. Sales were $2.03 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.

The Wall Street consensus estimate for earnings would represent a 82.61% increase for the company. Revenue would be up 2.67% on a year-over-year basis. Interpublic Gr of Cos's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Interpublic Gr of Cos were trading at $30.9 as of July 19. Over the last 52-week period, shares are up 70.0%. Given that these returns are generally positive, long-term shareholders are probably content going into this earnings release.

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