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On Wednesday, February 24, Kaiser Aluminum (NASDAQ:KALU) will report its last quarter's earnings. Here is Benzinga's preview of the company's release.
Net Income, Earnings, 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
Sell-side analysts expect Kaiser Aluminum's EPS to be near $0.28 on sales of $261.03 million. Kaiser Aluminum reported a per-share profit of $1.79 when it published results during the same quarter last year. Sales in that period totaled $369.00 million.
Why Analyst Estimates And Earnings Surprises Are Important
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 analyst consensus estimate would represent a 84.36% decrease in the company's earnings. Sales would be down 29.26% on a year-over-year basis. Here is how the company's reported EPS has stacked up against analyst estimates in the past:
Over the last 52-week period, shares are up 14.11%. Given that these returns are generally positive, long-term shareholders can relax 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. Kaiser Aluminum is scheduled to hold the call at 13:00:00 ET and can be accessed here.
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