Fourth Quarter Earnings and Revenue Beat Rates
Tuesday, January 24, 2012 at 09:54AM While the current earnings season is still young, numbers versus expectations have been weak for both the bottom and top line.
As shown in the charts below, 58.5% of companies have beaten earnings estimates so far this season, while 57% have beaten revenue estimates. The earnings beat rate had picked up on a quarter-over-quarter basis in the prior two reporting periods, but this season it has dropped back down to a new bull market low. The revenue beat rate saw its lowest reading of the bull market last earnings season, but it is making a lower low once again this season.
There's still a lot of time left, but these numbers actually tend to drift lower and not higher as earnings season progresses.
So why has the market done so well this earnings season even though "beat rates" have been weak? We just published a B.I.G. Tips report over at Bespoke Premium that answers this question. Click here to view the report if you're already a member. Or click here to become a member today!
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