Conagra Brands's Earnings: A Preview

On Tuesday, July 13, Conagra Brands CAG will release its latest earnings report. Decipher the announcement with Benzinga's help.

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

Based on Conagra Brands management projections, analysts predict EPS of $0.52 on revenue of $2.71 billion. In the same quarter last year, Conagra Brands announced EPS of $0.75 on revenue of $3.29 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.

If the company were to report earnings in line when it publishes results Tuesday, quarterly profit would be down 30.67%. Revenue would be down 17.58% from the year-ago period. Here is how the Conagra Brands's reported EPS has stacked up against analyst estimates in the past:

Stock Performance

Shares of Conagra Brands were trading at $36.12 as of July 09. Over the last 52-week period, shares are down 2.56%. Given that these returns are generally negative, long-term shareholders are likely a little upset going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Conagra Brands is scheduled to hold the call at 09:30:00 ET and can be accessed here.