Saturday, July 23, 2011

Second Quarter Earnings and Revenue Beat Rates

by Bespoke Investment group

Since last Monday when earnings season began, 345 US stocks have reported their quarterly numbers. As shown below, 70% of these companies have beaten earnings per share estimates, while 71% have beaten revenue estimates. Both of these numbers are high relative to prior quarters during the current bull market, but they also both typically pull back as earnings season progresses.

Last season, the earnings beat rate came in at its lowest level of the bull market. As of now, it appears as if the beat rate will be stronger this quarter, which is a good sign. The revenue beat rate wasn't all that bad last quarter, and it will be pretty impressive if we can see a quarter-over-quarter increase when all is said and done this season.




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