Wendy's (NASDAQ:WEN) will be releasing its next round of earnings this Wednesday, May 12. For all of the relevant information, here is your guide for Wednesday's Q1 earnings announcement.
Net Income, Earnings, 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
Wendy's EPS is expected to be around $0.14, according to sell-side analysts. Sales will likely be near $444.31 million. In the same quarter last year, Wendy's announced EPS of $0.09 on revenue of $404.96 million.
What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?
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 company in a quarter yields the "consensus estimates." A company posting earnings or revenue above or below the consensus estimate is known as an "earnings surprise" and may move the stock by a considerable margin.
If the company were to match the consensus estimate when it reports Wednesday, EPS would be up 55.56%. Revenue would be up 9.72% on a year-over-year basis. Wendy's's reported EPS has stacked up against analyst estimates in the past like this:
|Quarter||Q4 2021||Q3 2020||Q2 2020||Q1 2020|
|Revenue Estimate||476.39 M||453.28 M||409.61 M||415.54 M|
|Revenue Actual||474.32 M||452.24 M||402.31 M||404.96 M|
For a full 12 months, the return has risen by 12.5%. Given that these returns are generally positive, long-term shareholders are probably relaxed going into this earnings release. Long-term shareholders are already enjoying 12-month gains prior to the announcement.
Do not be surprised to see the stock move on comments made during its conference call. Wendy's is scheduled to hold the call at 08:30:00 ET and can be accessed here.