Energy Recovery Earnings Preview

Energy Recovery ERII announces its next round of earnings this Thursday, March 11. Here is Benzinga's look at Energy Recovery's Q4 earnings report.

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

Energy Recovery earnings will be near $0.04 per share on sales of $25.08 million, according to analysts. In the same quarter last year, Energy Recovery reported a loss per share of $0.01 on revenue of $19.50 million.

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 500.0% increase in the company's earnings. Sales would be up 28.61% on a year-over-year basis. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:

Stock Performance

Shares of Energy Recovery were trading at $17.49 as of March 09. Over the last 52-week period, shares are up 153.57%. 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. Energy Recovery is scheduled to hold the call at 17:00:00 ET and can be accessed here.