Earnings Beat Rate Dips a Bit

There were 490 more earnings reports this week, taking the overall total up to 2,192 since earnings season began on July 9th.  As shown below, 58.8% of the 2,192 companies that have reported this season have beaten consensus analyst estimates.  At 58.8%, the earnings beat rate this reporting period is 3.5 percentage points lower than the average quarterly reading of 62.3% seen since 1998.  If earnings season were to end today, it would be the lowest reading we've seen since the bull market began as well.  Earnings season ends next Thursday when Wal-Mart reports, and with just 108 companies left to report, we're going to need to see a lot of beats to get above last quarter's reading of 59.5%.

Below is a chart that shows how the overall beat rate this earnings season has changed as the reporting period has progressed.  After a poor start, the beat rate got up into the low 60s a couple weeks in, but it has been steadily drifting lower since the end of July.  On July 30th, 61.3% of companies that had reported had beaten earnings estimates, but the beat rate has pretty much dipped lower each day since.

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