A Preview Of Fiserv's Earnings

On Tuesday, February 09, Fiserv FISV will release its latest earnings report. Check out Benzinga's preview to understand the implications.

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

Based on management's projections, Fiserv analysts model for earnings of $1.29 per share on sales of $3.73 billion. Fiserv reported a per-share profit of $1.13 when it published results during the same quarter last year. Sales in that period totaled $4.04 billion.

Why Analyst Estimates And Earnings Surprises Are Important

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 analyst consensus estimate would represent a 14.16% increase in the company's earnings. Revenue would have fallen 7.79% from the same quarter last year. Here is how the company's reported EPS has compared to analyst estimates in the past:

Stock Performance

Over the last 52-week period, shares are down 5.7%. Given that these returns are generally negative, long-term shareholders won't be happy going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Fiserv is scheduled to hold the call at 17:00:00 ET and can be accessed here.