Let me know this by an example to illustrate how Screener might calculate the “Expected Quarterly EPS” using hypothetical data.
Company XYZ Example:
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Historical Sales Data:
- Q1 2023: ₹500 million
- Q2 2023: ₹550 million
- Q3 2023: ₹600 million
- Q4 2023: ₹660 million
Observed Sales Growth Rate:
- Q1 to Q2: 10%
- Q2 to Q3: 9.1%
- Q3 to Q4: 10%
Average Sales Growth Rate: (10% + 9.1% + 10%) / 3 ≈ 9.7%
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Expected Sales Growth Rate for Q1 2024:
Using the average growth rate of 9.7%, we project the Q1 2024 sales:- Q1 2024 expected sales: ₹660 million * (1 + 9.7%) ≈ ₹724.02 million
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Historical Profit Margins:
- Gross Profit Margin: 30%
- Operating Profit Margin: 20%
- Net Profit Margin: 15%
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Projected Gross Profit for Q1 2024:
- Gross Profit: 30% of ₹724.02 million ≈ ₹217.21 million
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Projected Operating Profit for Q1 2024:
- Operating Profit: 20% of ₹724.02 million ≈ ₹144.80 million
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Projected Net Profit for Q1 2024:
- Net Profit: 15% of ₹724.02 million ≈ ₹108.60 million
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Outstanding Shares:
- Let’s assume Company XYZ has 10 million outstanding shares.
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Projected EPS for Q1 2024:
- Projected EPS = Projected Net Profit / Outstanding Shares
- Projected EPS = ₹108.60 million / 10 million shares
- Projected EPS ≈ ₹10.86
Summary:
Based on this example, Screener’s expected quarterly EPS for Company XYZ for Q1 2024 would be ₹10.86.
Key Points:
- Sales Growth Rate: Derived from historical sales data.
- Profit Margins: Historical profit margins are applied to projected sales.
- Adjustments: Expenses, taxes, and other factors are considered based on historical trends.
- Outstanding Shares: The number of shares is used to calculate the EPS.
Screener uses historical financial data and observed growth patterns to estimate future performance, ensuring the projections are based on realistic and data-driven assumptions.