A Preview Of K12's Earnings

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K12 LRN will be releasing its next round of earnings this Tuesday, April 20. For all of the relevant information, here is your guide for Tuesday's Q3 earnings announcement.

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

Wall Street analysts see K12 reporting earnings of $0.47 per share on sales of $380.94 million. K12 reported a profit of $0.22 per share when it published results during the same quarter last year. Sales in that period totaled $257.15 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.

If the company were to match the consensus estimate when it reports Tuesday, earnings would be up 113.64%. Revenue would be up 48.14% on a year-over-year basis. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Quarter Q2 2021 Q1 2020 Q4 2020 Q3 2020
EPS Estimate 0.49 -0.31 0.03 0.19
EPS Actual 0.60 0.30 0.31 0.22
Revenue Estimate 363.68 M 362.52 M 261.46 M 253.83 M
Revenue Actual 376.14 M 370.96 M 268.93 M 257.15 M

Stock Performance

Shares of K12 were trading at $32.31 as of April 16. Over the last 52-week period, shares are up 31.62%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. K12 is scheduled to hold the call at 17:00:00 ET and can be accessed here.

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