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IHS Markit's Earnings: A Preview

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IHS Markit (NYSE:INFO) announces its next round of earnings this Wednesday, January 13. Here is Benzinga's everything-that-matters guide for this Wednesday's Q4 earnings announcement.

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

Sell-side analysts expect IHS Markit's EPS to be near $0.67 on sales of $1.11 billion. In the same quarter last year, IHS Markit reported earnings per share of $0.65 on revenue of $1.12 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.

If the company were to post earnings in line with the consensus estimate when it reports Wednesday, EPS would be up 3.08%. Revenue would be down 0.89% on a year-over-year basis. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020
EPS Estimate 0.69 0.67 0.64 0.61
EPS Actual 0.77 0.69 0.66 0.65
Revenue Estimate 1.07 B 1.06 B 1.08 B 1.12 B
Revenue Actual 1.07 B 1.03 B 1.08 B 1.12 B

Stock Performance

Shares of IHS Markit were trading at $87.56 as of January 11. Over the last 52-week period, shares are up 10.01%. 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. IHS Markit is scheduled to hold the call at 08:00:00 ET and can be accessed here.

 

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Posted-In: BZI-EPEarnings