Thursday, April 21, 2011

Earnings "Beat Rate" Not Looking So Great...So Far

by Bespoke Investment Group

It's still early yet, but the earnings "beat rate" -- the percentage of companies beating earnings estimates -- this earnings season is not looking so great. As shown in the first chart below, 64% of US companies have beaten earnings estimates so far this earnings season. A "beat rate" of 64% would be the weakest reading since the start of the bull market back in April 2009. Again, it's still early, but unfortunately the "beat rate" has historically started out high and drifted lower as earnings season progresses. If that's the case this earnings season, the "beat rate" could have a five handle.



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