First-quarter earnings reports are 98 percent complete with 495 of the 500 companies in the S&P 500 having reported.

Headlines were generally positive with 72 percent of companies beating expectations, a little more than average. However, nothing else about the earnings season seems to be very good.

Most companies beat expectations when adjusted earnings are considered. If companies are held to generally accepted accounting principles (GAAP), just 36 percent of companies beat expectations.

Companies are increasingly reporting non-GAAP numbers that remove certain charges they believe investors should ignore.

For example, when the dollar is strong, many companies ask investors to overlook the adverse impact that had on earnings.

We do not generally see companies asking investors to ignore the beneficial impact of a weak dollar.

Using adjusted earnings, the companies in the S&P 500 reported earnings per share (EPS) of $98.70 for the past 12 months. EPS are weighted to account for the stock’s market value.

This is the lowest level since the first quarter of 2013 when EPS were $98.35.

Using GAAP, the story is even worse. GAAP earnings for the past 12 months were $86.50, their lowest level since the second quarter of 2012.

Stalled earnings, on a GAAP or non-GAAP basis, haven’t held the S&P 500 down. Since the first quarter of 2013 the index has delivered a total return of 43% and investors have enjoyed a 67% gain since June 2012.

Can the gains continue without earnings growth? Bears and value investors will answer “no” but Janet Yellen is unlike anyone we’ve ever seen before. She might just be able to keep stocks rallying even if earnings continue to lag.

Michael Carr, CMT, is a subadviser to a mutual fund family and a chartered market technician. To read more Michael Carr, CLICK HERE NOW.