Johnson & Johnson (NYSE:JNJ) unveils its next round of earnings this Wednesday, July 21. Here is Benzinga's everything-that-matters guide for the earnings announcement.
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
Analysts covering Johnson & Johnson modeled for quarterly EPS of $2.27 on revenue of $22.19 billion. Johnson & Johnson EPS in the same period a year ago totaled $1.67. Revenue was $18.34 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 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, earnings would be up 35.93%. Revenue would be up 21.02% from the same quarter last year. In comparison to analyst estimates in the past, here is how the company's reported EPS stacks up:
| Quarter | Q1 2021 | Q4 2020 | Q3 2020 | Q2 2020 |
|---|---|---|---|---|
| EPS Estimate | 2.34 | 1.82 | 1.98 | 1.48 |
| EPS Actual | 2.59 | 1.86 | 2.20 | 1.67 |
| Revenue Estimate | 22.01 B | 21.67 B | 20.20 B | 17.50 B |
| Revenue Actual | 22.32 B | 22.48 B | 21.08 B | 18.34 B |
Stock Performance
Earning Estimates From Bloomberg
Do not be surprised to see the stock move on comments made during its conference call. Johnson & Johnson is scheduled to hold the call at 08:30:00 ET.