On Wednesday, October 21, AutoNation AN will release its latest earnings report. Here is Benzinga's outlook for the company.
What Are Earnings, Net Income And Earnings Per Share (EPS)?
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
Wall Street analysts see AutoNation reporting earnings of $1.58 per share on revenue of $5.13 billion. AutoNation reported a per-share profit of $1.18 when it published results during the same quarter last year. Sales in that period totaled $5.46 billion.
Why Analyst Estimates And Earnings Surprises Are Important
Analysts who cover this company will publish forward-looking estimates of its revenue and EPS each quarter. Averaging together every EPS and revenue prediction that each analyst makes about a given company yields the "consensus estimates." If the company posts earnings or revenue above or below the consensus estimate, the stock may move by a considerable margin.
If the company were to match the consensus estimate, earnings would be up 33.9%. Sales would have fallen 6.06% from the same quarter last year. AutoNation's reported EPS has stacked up against analyst estimates in the past like this:
| Quarter | Q2 2020 | Q1 2020 | Q4 2020 | Q3 2019 |
|---|---|---|---|---|
| EPS Estimate | 0.37 | 0.69 | 1.14 | 1.12 |
| EPS Actual | 1.41 | 0.91 | 1.31 | 1.18 |
| Revenue Estimate | 4.08 B | 4.61 B | 5.53 B | 5.38 B |
| Revenue Actual | 4.53 B | 4.67 B | 5.55 B | 5.46 B |
Stock Performance
Shares of AutoNation were trading at $61.98 as of October 19. Over the last 52-week period, shares are up 22.45%. 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. AutoNation is scheduled to hold the call at 09:00:00 ET and can be accessed here: https://event.on24.com/eventRegistration/EventLobbyServlet?target=reg20.jsp&referrer=https%3A%2F%2Finvestors.autonation.com%2Fnews-and-events%2Fevents-and-presentations%2Fdefault.aspx&eventid=2633192&sessionid=1&key=F9D9A27EEB44AABC5A806B21918A8866®Tag=&sourcepage=register
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