Heading into fourth-quarter earnings season there was a lot of gloom about what companies on the Standard & Poor’s 500 index would be reporting — with observers worried that the fiscal cliff negotiations had hurt companies, and asking if the election had sidetracked the economy (among other concerns).
Well, so far those fears seem to be unfounded: With 38% of S&P 500 companies reporting, 69% have beaten expectations (compared to a typical — going back to 1994 — figure of 62%), and the blended earnings per share growth is on track to be 3.4%, according to Thomson Reuters; revenue is on track to grow by 2.5%.
That compares favorably to third-quarter results, when S&P 500 companies delivered earnings growth of 0.1%, though it’s down from the year-ago quarter, when profit per share grew by 9.2%.
The standout sectors so far for the latest quarter is financials, with companies on track for 12.4% blended earnings growth, according to Thomson Reuters. The sector’s revenue is on course for 7.3% growth. Consumer discretionary, meanwhile, is heading for an 11.8% blended earnings growth and 6.1% blended revenue growth. Utility companies, meanwhile, are seeing revenue up 11.4%, though only 0.1% earnings growth.
On the downside, telecoms companies are looking at a 14.9% fall in earnings growth, though a 3% rise in revenue, while energy companies are seeing revenue fall 10% and earnings growth drop 0.5%.
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