Tags: earnings | estimates | revenue | analysts

CNBC: Earnings Are Beating Expectations, But That's Nothing Unusual

By    |   Tuesday, 22 April 2014 08:20 AM

The stock market is apparently a place where most companies are above average.

Of the 85 companies in the S&P 500 index that have reported their first-quarter earnings, 67 percent have exceeded analysts' earnings estimates, according to FactSet. And 51 percent have topped analysts' predictions for revenue.

But that's no big deal, CNBC reports. For the last four years, 73 percent of companies have beaten earnings estimates, and 58 percent have bested revenue forecasts.

Editor's Note:
New Warning — Stocks on Verge of Major Collapse


Moreover, aggregate corporate earnings for the first quarter beat analysts' forecasts by only 2 percent, far below the 5.8 percent beat recorded during the last four years.

Meanwhile, aggregate corporate revenue for the first quarter stands 0.3 percent below analysts' projections, according to CNBC.

"This is not a strong start to the earnings season," FactSet senior earnings analyst John Butters tells CNBC. "Where we stand right now, we're seeing fewer companies beating than we'd expect, and we're still looking at a year-over-year earnings decline."

Perhaps that helps explain why the S&P 500 hasn't been able to top its April 4 record high and the Nasdaq Composite has slipped from its 13-year high of March 6.

"The earnings picture is mixed, and mixed is fine. As long as it is not slapped in the face by these earnings, the stock market can find other ways to rally," Jim Iuorio of TJM Institutional Services tells CNBC.

To be sure, the S&P 500 is on a five-day winning streak, and not everyone is bearish about earnings.

"The few earnings that we've had so far have been coming in pretty well," John Fox, director of research at Fenimore Asset Management, tells Bloomberg. "All the fundamentals still line up that stock prices can go higher. Interest rates are still low, the economy's getting better."

Editor's Note: New Warning — Stocks on Verge of Major Collapse

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InvestingAnalysis
The stock market is apparently a place where most companies are above average.
earnings, estimates, revenue, analysts
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2014-20-22
Tuesday, 22 April 2014 08:20 AM
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