This Earnings Season Is Blowing Away Estimates And Even Blowing Away Last Quarter, But It Hasn't Been Enough To Lift The Market


77.8% of companies have beaten their first quarter earnings estimates so far this earnings season, according to the latest ‘PULSE Monitor’ from Citi’s Tobias Levkovich.


Of the 324 S&P 500 companies that had reported 1Q10earningsthrough 4/29/10, 252 had beaten estimates and 43 had missed. Therefore, the 1Q10 ratio of positive to negative surprise is 5.86x versus a 4Q09 ratio of 4.06x, and 1Q09 ratio of 2.90x thus far into the earnings reporting season.

Based on the positive to negative surprise ration, this season is better than 4Q of last year even.

The chart shown above reflects the % of earnings revisions which have been positive — it turns out 69.8% of earnings revisions have been upward in April according to Citi.

In total, analysts have underestimated earnings by nearly 16% for the market so far.

In aggregate, 1Q10 share- weighted results are beating expectations by 15.7% and are up 52.7% (thus far) from a year ago.

Financials, Consumer Discretionary, and Industrials appear to be leading the way in terms of topping estimates thus far for 1Q10.

While the S&P 500 rose ahead of 1Q earnings, it has lost steam during the earnings season despite the substantial amount of earnings ‘beats’ so far. Have investors missed the strong earnings or have strong earnings not been enough?


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