Benzinga | Oct 26, 2020 10:06AM EDT

A Preview Of Asbury Automotive Group's Earnings

Asbury Automotive Group (NYSE: ABG) releases its next round of earnings this Tuesday, October 27. Get the latest predictions in Benzinga's essential guide to the company's Q3 earnings 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

Sell-side analysts expect Asbury Automotive Group's EPS to be near $3.38 on sales of $1.79 billion. In the same quarter last year, Asbury Automotive Group reported EPS of $2.33 on revenue of $1.84 billion.

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.

The analyst consensus estimate would represent a 45.06% increase in the company's EPS figure. Revenue would be down 2.82% on a year-over-year basis. Here is how the company's reported EPS has compared to analyst estimates in the past:

Quarter Q2 2020 Q1 2020 Q4 2020 Q3 2019EPS Estimate 2.20 1.67 2.34 2.32EPS Actual 2.52 1.80 2.53 2.33Revenue Estimate 1.42 B 1.57 B 1.88 B 1.84 BRevenue Actual 1.45 B 1.61 B 1.89 B 1.84 B

Stock Performance

Shares of Asbury Automotive Group were trading at $119 as of October 22. Over the last 52-week period, shares are up 10.55%. Given that these returns are generally positive, long-term shareholders should be content going into this earnings release.

Do not be surprised to see the stock move on comments made during its conference call. Asbury Automotive Group is scheduled to hold the call at 10:00:00 ET and can be accessed here.