Market Overview

CoStar Group's Earnings: A Preview

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On Tuesday, October 27, CoStar Group (NASDAQ: CSGP) 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

Based on CoStar Group management projections, analysts predict EPS of $2.07 on revenue of $417.43 million. In the same quarter last year, CoStar Group reported earnings per share of $2.61 on revenue of $352.81 million.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

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 Tuesday, earnings would be down 20.69%. Sales would be up 18.32% from the year-ago period. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Quarter Q2 2020 Q1 2020 Q4 2020 Q3 2019
EPS Estimate 2 2.27 2.62 2.52
EPS Actual 2.34 2.44 2.82 2.61
Revenue Estimate 390.15 M 387.42 M 364.35 M 353.23 M
Revenue Actual 397.16 M 391.85 M 374.73 M 352.81 M

Stock Performance

For a full 12 months, the return has risen by 47.89%. Given that these returns are generally positive, long-term shareholders are probably relaxed 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. CoStar Group is scheduled to hold the call at 17:00:00 ET and can be accessed here.

 

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Posted-In: Earnings