Earnings Outlook For Mercury General

Mercury General MCY announces its next round of earnings this Tuesday, February 16. Here is Benzinga's everything-that-matters guide for this Tuesday's Q4 earnings announcement.

What Are Earnings, Net Income, And Earnings Per Share?

Earnings and especially earnings per share (EPS) are useful measures of a company's profitability. Total earnings, which is also referred to as net income, equals total revenue minus total expenses. EPS equals to net income divided by the number of shares outstanding.

Earnings And Revenue

Sell-side analysts expect Mercury General's EPS to be near $0.69 on sales of $932.26 million. In the same quarter last year, Mercury General reported earnings per share of $0.21 on sales of $987.99 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 analyst consensus estimate would represent a 228.57% increase in the company's EPS figure. Revenue would be down 5.64% from the year-ago period. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

Shares of Mercury General were trading at $56.5 as of February 11. Over the last 52-week period, shares are up 8.36%. Given that these returns are generally positive, long-term shareholders can be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Mercury General is scheduled to hold the call at 13:00:00 ET and can be accessed here.