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Not a bug

Reconcile EPS Data Inconsistencies

Jeff Partlow 10 months ago • updated by Jae Jun 7 months ago 6

Using Hawaiian Holdings (HA) as an example:

Current Year Mean EPS Estimate $4.77

Next Year Mean EPS Estimate $4.88

Last Year EPS $5.19

Next Year EPS Estimate $4.77

Earnings Per Share $4.52

Average Estimate EPS, Next Year $4.99

Total Basic EPS TTM $5.07

Earnings Per Share TTM $4.52 (in Compare Competitors under Selected Financials)

Is Next Year Est. $4.88, $4.77, or $4.99?


Also, it is difficult to easily determine whether the Current Year is 2017 or 2016. In Dive into Data section -- in Key Stats category it is 2017 but in Financials category it is 2016. A suggestion to help clarify Current Year would be to include it as a display data point option available in both the Screener and Compare Competitors sections.

Not sure, but perhaps inconsistencies identified in my prior post 2 weeks ago might be from usually using Non-GAAP EPS, but some data points being GAAP EPS. Here is an example for ESRX using default settings:


Suggest not mixing non-GAAP and GAAP numbers for any particular company. Also, make it clear to users somehow whether numbers for that company are GAAP or non-GAAP. Thank you.

Hi Jeff,

If any EPS has the word "estimate" in it, it's neither GAAP or Non-GAAP. Those are concensus numbers taken from analyst estimates.

Jae,

You're missing 3 things that need to be addressed/fixed related to EPS:


1. In the chart above, the $5.39 (which is last year GAAP) should be $6.39 instead (Non-GAAP) -- which is correctly shown (and highlighted in yellow in the chart below). The $6.39 relates to analysts consensus estimates of $6.94 for this year and $7.61 for next year.


2. In the chart below, the last line is wrong. The 'Next Year EPS Estimate' showing as $6.94 should be $7.61.




3. This is the most important point because it pertains to accuracy and consistency of the data points. Most companies report and reconcile GAAP and non-GAAP EPS numbers, and the differences between them are not insignificant or trivial. They are often substantial.

In order to correct ALL the inconsistencies in EPS as shown in my original post (using Hawaiian Holdings) above, you need to do a more comprehensive review of all EPS-related data points you use -- and make distinctions between GAAP and Non-GAAP numbers wherever and whenever necessary. This will not be a quick fix, but it is of paramount importance because accuracy of the information presented in this app is absolutely essential for us users.

Here is some additional information I am providing that I hope will be helpful to you in determining how to reconcile current EPS inconsistencies.

1. Observations (from table below):

- Of 11 companies shown, only Apple reports solely GAAP EPS.

- Analysts future EPS estimates are relative to past non-GAAP EPS. Future estimates are only relative to GAAP EPS for those companies that report only GAAP EPS.


Source: Schwab.com


2. Suggestion for OSV app:

- For companies reporting non-GAAP EPS, default numbers should be non-GAAP. For user clarity, all GAAP numbers displayed should be identified as such (i.e. include 'GAAP EPS' in description). And where GAAP EPS numbers are displayed, comparisons between that company's GAAP and non-GAAP EPS should be provided (such as those shown in the table above) to help us users to do accurate analysis of any company's EPS-related numbers. Thank you for addressing this topic.

When evaluating any company (note: ESRX is only one example), it is useful to compare recent EPS actuals with estimates for current year and next year EPS. Here is the current OSV-displayed data:


As described in my first two comments above, the $5.39 GAAP EPS number should be changed to the Non-GAAP EPS (which is $6.39 in this example) in order to be comparable to the Non-GAAP EPS estimates of $6.94 and $7.62. It is deceptive to anyone now comparing these 3 numbers because they might be likely to erroneously conclude that ESRX's EPS is estimated to increase by 28.8% this year (from $5.39 TTM to $6.94 this year).

Not a bug

@Jeff,

Since the numbers can't be changed, realized it will be easier add "Non-GAAP" text to the label.