Market Overview

Royal Bank of Canada Earnings Preview


Royal Bank of Canada (NYSE:RY) releases its next round of earnings this Wednesday, December 02. Get the latest predictions in Benzinga's essential guide to the company's Q4 earnings report.

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

Royal Bank of Canada earnings will be near $1.61 per share on sales of $8.05 billion, according to analysts. In the same quarter last year, Royal Bank of Canada reported EPS of $1.65 on revenue of $8.58 billion.

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 report earnings in line when it publishes results Wednesday, quarterly profit would be down 2.42%. Revenue would be down 6.22% on a year-over-year basis. Here is how the Royal Bank of Canada's reported EPS has stacked up against analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2019
EPS Estimate 1.61 1.60 1.60 1.60
EPS Actual 1.59 0.75 1.88 1.65
Revenue Estimate 8.32 B 8.32 B 8.32 B 8.32 B
Revenue Actual 9.32 B 7.49 B 9.88 B 8.58 B

Stock Performance

Shares of Royal Bank of Canada were trading at $81.98 as of November 30. Over the last 52-week period, shares are up 4.35%. Given that these returns are generally positive, long-term shareholders are probably happy going into this earnings release.

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


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Posted-In: Earnings