Estimating earnings (Model 5 G. Foster)

[Brian_S]

Hi there.
I have a dataset of historical quarterly earnings per share for 8 years.
I am trying to use the following formula for the purpose of estimating earnings: E(Qt) =Qt-4 + φ1(Qt-1 -Qt-5) + δ; where φ1 is given by the first order autocorrelation coefficient (r1). E(Qt) is the expected quarterly earnings in quarter t. A preliminary estimate of δ is given by (1- φ1)*u, where u is the mean of the seasonally differenced series.

Can anyone explain to me shortly (or refer me to a link with the explanation) how to calculate φ1?
It is important that the calculation is based only on the historical data available.
Thanks.

P.S. The formula stems from George Foster's 1977 article - "Quarterly Accounting Data: Time-Series Properties and Predictive-Ability Results".
I use Eviews 8

BR Brian