On Monday, May 10, Catalyst Pharmaceuticals (NASDAQ:CPRX) will report its last quarter's earnings. Here is Benzinga's preview of the company's release.
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
Catalyst Pharmaceuticals EPS is expected to be around $0.09, according to sell-side analysts. Sales will likely be near $32.10 million. In the same quarter last year, Catalyst Pharmaceuticals announced EPS of $0.1 on revenue of $29.14 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 report earnings in line when it publishes results Monday, earnings would be down 10.0%. Sales would be up 10.17% on a year-over-year basis. Here is how the company's reported EPS has stacked up against analyst estimates in the past:
|Quarter||Q4 2021||Q3 2020||Q2 2020||Q1 2020|
|Revenue Estimate||30.35 M||31.49 M||29.48 M||31.46 M|
|Revenue Actual||31.02 M||29.32 M||29.61 M||29.14 M|
Shares of Catalyst Pharmaceuticals were trading at $4.67 as of May 06. Over the last 52-week period, shares are down 5.74%. Given that these returns are generally negative, long-term shareholders are probably upset going into this earnings release.
Do not be surprised to see the stock move on comments made during its conference call. Catalyst Pharmaceuticals is scheduled to hold the call at 08:30:00 ET and can be accessed here.