Earnings Preview: Chegg

Chegg CHGG unveils its next round of earnings this Monday, February 08. Get prepared with Benzinga's ultimate preview for Chegg's Q4 earnings.

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

Analysts expect Chegg earnings of $0.49 per share. Revenue will likely be around $189.55 million, according to the consensus estimate. In the same quarter last year, Chegg reported EPS of $0.35 on revenue of $125.50 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.

The Wall Street estimate would represent a 40.0% increase in the company's earnings. Sales would be have grown 51.03% from the same quarter last year. Chegg's reported EPS has stacked up against analyst estimates in the past like this:

Stock Performance

Shares of Chegg were trading at $99.87 as of February 04. Over the last 52-week period, shares are up 126.51%. Given that these returns are generally positive, long-term shareholders should be content going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Chegg is scheduled to hold the call at 16:30:00 ET and can be accessed here.