Tag Archives: Economy

Earnings Matter, ultimately the most, let’s take a peek at how they are doing

With earnings being the ultimate driver of Capital Markets it’s always good to stick our heads down into the weeds occasionally to see how corporate managers are navigating the waters.

Our favorite go-to source for this information is from our friends at Factset, a research arm that does terrific tracking …

Here are a few charts with our notes:

This following is an estimate of Earnings for the remainder of 2019 and for the year 2020 – notice expectations are positive year over year 2018 to 2019 but not much growth is expected from the analyst community – Tariff agreement would likely change this expectation quickly…

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Next up, how the change in estimates has occurred in real time – take note of the drop near the end of the year 2018 – while it looks like a larger than normal drop, and we prefer it increasing, it is only about a 5% total expected drop but again still a year over year increase as seen from the prior chart.

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Lastly, we had to throw one of our favorite charts in from our friends at JPMorgan – the lagging blue line, that actually looks out of place, is the current market expansion rate – note how slow this expansion (2007-current) has been. We find this very interesting as even the 2001 expansion was at a much faster pace than our current. Could we be entering an extended period of slower, but more stable growth? This would also speak to lessened concerns of inflation and lowered expectations moving forward…

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Overall, lets give corporate managers an A to almost A+, especially those dealing with overseas trading partners of any kind.

Have a Great “Update Earnings” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
jkfinancialinc
street-cents

Earnings Review … aka 90 day Treadmill … Revenue the missing link, found?

As mentioned Friday, earnings are the key drivers to asset growth and appreciation.  While we do not want to get into the weeds too much on this, continued growth bodes well for continued market appreciation… and maybe growth into the Frothy valuations.. From our fantastic friends at Factset.

Earnings Growth for the Immediate Quarter Looks Great

While a very short term time frame, (3-5 years is our normal time frame) this 90 day treadmill aka earning season chart shows the move upward in expected earnings growth rate. Continued movement at this rate would certainly help us grow into the current valuations.

 

8-4-17 Factset Earnings Growth Q217

Nice move!

EPS- Earnings Per Share

Ok, sure the EPS Earnings Per Share- solid line is moving down as time has passed for this quarter, BUT, the scale is very narrow and the amount of lowered expected EPS growth is only slightly less…

8-4-17 Factset Change in Q317 eps

Before looking too much into this, the lower line is a tiny move due to the frame size!

Revenue/Sales Growth FINALLY?

Be it the Great Recession lingering effects, demographics, economics, world growth or technological advances, Sales or Revenue has been missing during this economic recovery. In reviewing this chart, Energy, bouncing back from a much lower price just a year ago is making up much of the sales increase, however other sectors are chiming in too. Could this FINALLY be the sales increases we have all been waiting for? Compliments to all company managers for cutting expenses in order to maintain profitability, however there are only so many cuts that can be made. If sales increases continue, this would provide much needed breathing room for managers.

8-4-17 Factset Rev Growth 2017

Sales growth has been absent this recovery, making for HUGE challenges for corporate managers

 

Time will tell! So far its looking good!

Have a Great “Growth in Earnings” Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
http://www.jkfinancialinc.com
http://www.street-cents.com

 

 

 

 

 

Q2 2017 Newsletter Podcast and Audio Review By John Kvale

Here are a few of the topics discussed in our new Podcast, Audio Video review.

  • David Cameron Speaks at length
  • University of Michigan Sentiment Indicators
  • Updated Price Earnings Multiple
  • Three Travel Tips to save you aggravation and time

Q2 2017 Newsletter Podcast and Video Review

 

Have a Great Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

 

Q1 2017 Newsletter Podcast and Audio Review By John Kvale

Here are just a few of the topics discussed in our new Podcast, Audio Video review. Due to the podcast format it is longer, but we think well worth the listen/view !

  • Taxes, Tax Deadlines, New Tax Dates, Tax Savings Ideas, Possible New Tax Rates
  • Economic Cycle Length
  • Interest Rates
  • Two cool Apps of the Quarter
  • 2016 Review
  • Managing your 401k, contribution reminders and matching stategies

Q1 2017 Newsletter Podcast and Video Review

Have a Great Day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
www.jkfinancialinc.com
www.street-cents.com

 

Four Positives to Keep the Perspective Clear

Seth Godin, creative thinker, inspirational motivator, author and high level thinker recently posted these charts….

In a times of negativity… these are great to recall

 

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Good stuff…all just terrific!

Have a GREAT day!

John A. Kvale CFA, CFP

Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth
Management firm.
http://www.jkfinancialinc.com
http://www.street-cents.com

 

 

“Don’t You Guys Want the Market’s to Go Up?”

During a car ride yesterday somewhat fleeing the rain from our not so guaranteed sunny state visit/vacation after an almost hour-long one-sided conversation that my wife had been listening to while Donald “The Brain” and I discussed earnings, interest rates, portfolio allocations, and the current market levels, she asked the following:

“Don’t you guys want the market’s to go up?”

Stunned by the question, I thought it worth mentioning. The short answer is absolutely, we want higher prices and we always want growth. The longer answer is at a reasonable rate. If markets get too far ahead of themselves they eventually will come crashing down, not what we want.  For the record, if everything was efficient there would be a much lower ability to earn returns.

Early Earnings Update

Winners are financials, manufacturing, and industrials…so far. Losers are broadly consumer driven areas. It is still in the first or second inning, but this is our initial take!

Interest Rates

Are finally behaving! Thanks goodness!! With Bernanke’s back and forth shuffling, we think market participants have finally calmed.

Enjoy your Friday, I will be back in next week (Tuesday), but of course this is the start to another summer weekend, albeit hot is certain areas of the country (rainy in others..haha) …. ENJOY! Summer Day road

John Kvale

PS Even after an hour-long drive, the rain found its way to our so-called sunny state visit…today, no rain, overcast but no rain…we will take what we can get!

PSS Ya, ya…I told the office, the family, and everyone, I would be out and probably not post much this week….Well,  I do Love this and enjoy sharing the thoughts!!

http://www.jkfinancialinc.com
http://www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225 

Boom….Bernanke Backpedals

Markets are really getting a lift today from a question and answer session of economists in Boston last night with Ben Bernanke.

Here is the key quote:

“Highly accommodative monetary policy is what is needed for some time in the future, especially given fiscal restraint”

This is somewhat of a U-Turn from his comments just a few weeks back.

Our thought, rates moved up too quickly for his liking.

Here is the 10 Year US Treasury

10 Year Yield 7-11-13

Fundamentals will eventually win

Earnings season is about to kick off, we need to see growth to support these levels, otherwise the markets are once again Frothy.. Let’s see how we do!

Have a good day!

John Kvale

http://www.jkfinancialinc.com
http://www.street-cent.com
8222 Douglas Ave # 590
Dallas, TX 75225 

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