Earnings Season (90 Day Treadmill) Winding Down, How Did We Do?

As of today approximately 90% of all S&P 500 companies have reported according to Thomson Reuters. In an effort to not forget the forest for the trees, we wanted to review the results.

Earnings Season

In our earlier Earnings Season post on April 14th, at the beginning of earnings season, we mentioned expectations of “….S&P 500 Growth this Quarter versus the same Quarter a year ago (Y/Y): 11.6%…..” 

Shortly there after, in our slightly silly Gomer Pyle post, Surprise, Surprise… just a week into earnings season we noted earning season was off to a very strong start. The positive reports continued and actually accelerated.

Through today, S&P 500 Growth this Quarter versus the same Quarter a year ago (Y/Y) is up a whopping 19.5% versus the expected 11.6% as we entered earning season just a few weeks ago.

As was expected, but not to the magnitude, the Materials Sector has had a 51% growth versus a 35% expected growth rate and the Utilities Sector brought up the rear with an approximate flat year over year (Y/Y) growth.

Here are a couple of interesting notes from or point of view:

  1. With actual earnings coming in at almost 20% versus expectations of 11.6% the S&P 500 has not moved much. (This is a good thing in our opinion as it may help the capital market earnings catch up to the advanced appreciation we have had so far in 2011.)
  2. Analysts are not raising their estimates as of yet, even with the good quarter under their belt. Thus far estimates revisions have actually been down for the next quarter, in “What have you done for me lately,” format. (This is also good, from our view, in that we would rather estimates be too low than come crashing down in later quarters.)

As we close the loop on the last 10% of S&P 500 companies to report, there is certainly the possibility of change, however we feel this earnings season is mostly in the book, and will go down as a very good one.

Have a Good Day!

JK

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