This article, originally scheduled for the Q 3 Newsletter, accidentally hit the cutting room floor. Here is an abbreviated version, with the full article to come in the Next Newsletter.
Energy our Lowered Price Friend
Airlines, heavy energy-consuming companies and summer vacationers are all cheering the lower price of oil, which tumbled dramatically in the fall of 2014. Lower energy prices act as a wage increase for most as in some way a lowered price of energy helps as a “consumer.”
As an Investor or worker in the Oil and Energy field, more of a Foe
As mentioned at the end of our Earnings Article in our Q3 Newsletter, energy has made up a great deal of the drop in earnings for the entire market as a whole. Just as vertical drilling and the various Shoal plays came on-line strong, the price as dropped like a rock.
This from FactSet: EPS estimates for 2015 — Energy is the far right diving down!
Energy and Oil Related, Friend Again
So as a consumer we are happy, but greatly overshadowed if we invest, work or have any related dealings with the energy area.
Hold on, not all is lost—
FactSet 2016 Expectations
Yep…that’s Energy expectations roaring back next year.
Never go “all in” or “all out” !
Have a great day!
John A. Kvale CFA, CFP
http://www.jkfinancialinc.com
http://www.street-cents.com
8222 Douglas Ave # 590
Dallas, TX 75225
$treet-¢ents 
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.
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…
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.
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
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Posted in Earnings, Earnings Season, Forecast, Investing/Financial Planning, Market Comments
Tagged 90 Day Treadmill, Earnings, Earnings Season, Economy, EPS, Factset