Hollysys Automation's Earnings: A Preview

On Thursday, November 12, Hollysys Automation HOLI 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 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

Hollysys Automation earnings will be near $0.45 per share on sales of $138.11 million, according to analysts. Hollysys Automation reported a profit of $0.49 per share when it published results during the same quarter last year. Sales in that period totaled $123.23 million.

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 when it reports Thursday, earnings would be down 8.16%. Sales would be have grown 12.07% 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 Hollysys Automation were trading at $11.94 as of November 10. Over the last 52-week period, shares are down 22.54%. Given that these returns are generally negative, long-term shareholders are probably upset going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Hollysys Automation is scheduled to hold the call at 20:00:00 ET and can be accessed here.