Pragmatic Capitalism

Practical Views on Money & Finance

An Early Look at Earnings Trends….

We’re still very early in the earnings season, but another quarter of fairly weak earnings appears to be in the works (via Zacks):

“Total earnings for these 22 companies are up +1.4% from the same period last year, with total revenues up +3.5%. This is better performance than what this same cohort of 22 companies did in the third quarter when total earnings were down -2.4% from the year-earlier period.

At this stage, the important story on the earnings front is what’s expected for the more than 95% that have still to report results. And those expectations have been steadily coming down over the last three months and are barely in positive territory now. Total earnings in the fourth quarter are expected to be up +0.4% from the same period last year. This is a sharp drop from the roughly +7% earnings growth rate that consensus expected just three months ago.

The downward adjustment to expectations notwithstanding, fourth quarter earnings growth is still better than what was expected in the third quarter just before the start of that reporting cycle. At this stage in the third quarter, total earnings were expected to be down more than -3% from the same period last year.

Actual results, however, came out a little better with total third quarter earnings essentially flat. Excluding Finance, total earnings in the third quarter were down -4.1%, while total ex-Finance revenues are expected to be down -1.3% in the fourth quarter.”

Cullen Roche

Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC.Orcam is a financial services firm offering asset management, private advisory, institutional consulting and educational services.He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance and Understanding the Modern Monetary System.
Cullen Roche

Latest posts by Cullen Roche (see all)

Got a comment or question about this post? Feel free to use the Ask Me Anything section or connect with me on Twitter or email.