Benzinga | Feb 2, 2021 10:21AM EST

Silicon Motion Technology Earnings Preview

On Wednesday, February 03, Silicon Motion Technology (NASDAQ:SIMO) will release its latest earnings report. Benzinga's outlook for Silicon Motion Technology is included in the following report.

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

Wall Street analysts see Silicon Motion Technology reporting earnings of $0.71 per share on sales of $139.94 million. Silicon Motion Technology reported a per-share profit of $0.96 when it published results during the same quarter last year. Sales in that period totaled $153.20 million.

What Are Analyst Estimates And Earnings Surprises, And Why Do They Matter?

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.

The Wall Street estimate would represent a 26.04% decline in the company's earnings. Revenue would be down 8.65% from the same quarter last year. Here is how the company's reported EPS has stacked up against analyst estimates in the past:

Quarter Q3 2020 Q2 2020 Q1 2020 Q4 2020EPS Estimate 0.67 0.74 0.67 0.87EPS Actual 0.76 0.81 0.80 0.96Revenue Estimate 120.05 M 137.00 M 131.07 M 142.61 MRevenue Actual 126.04 M 136.81 M 132.77 M 153.20 M

Stock Performance

Over the last 52-week period, shares are up 6.2%. Given that these returns are generally positive, long-term shareholders can relax 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. Silicon Motion Technology is scheduled to hold the call at 08:00:00 ET and can be accessed here.