Earnings are the ultimate driver of stock prices …
Managers work VERY hard to estimate what they will earn and carefully deliver that information to Wall Street – Carefully because a disappointment leads to loss of trust, embarrassment, and likely a slammed stock price – Think of it as blowing your budget in a public forum …
Estimates Return – SLOWLY
A short personal story – long time followers know copyright is very important, so when using others material, we always ask for permission if it is not clear we can reproduce the material – John Butters the continuous author of this report personally took the time to email me back, thank me for the request to use his material and said of course – making us even happier and more frequent users of his material…. ok, slight digression …
For the second quarter, 53 S&P 500 companies issued quarterly EPS guidance, which was the lowest number of S&P 500 companies issuing EPS guidance for a quarter since FactSet began tracking this metric in 2006.From our dear Friend John Butters at FactSet:
Managers being conservative and protecting their names, pulled estimates … actually not surprising due to the circumstances….
Slowly they are getting confident enough to put estimates out there…. good progress as the look through continues!
Have a Great “Earnings are coming back” Day!
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth