The financial media loves to talk earnings and discuss the earnings beat rates versus the earnings miss rates, etc., and such, but all you need is to look at our Excel spreadsheet, which we have kept updated, based on Thomson Reuters data, for quite a long time.
As you can see from the spreadsheet below, the q2 ’14 earnings season was just as “normal” as the last 4 years.
We have blocked the heaviest reporting period during each earnings season with dark borders.
Q2 ’14 was “Same as it Ever Was”, as the Talking Heads once articulated.
Note how during the heaviest part of the reporting period, sees the biggest jump in positive estimate revisions. Biased by endless management positivism ? Sure, but so far the revision data has been a good indicator. Also note the q4 ’13 data which was released in q1 ’14 and thus influenced by the brutal Midwest and Northeast winter, was the first quarter in a while with revisions less than 50%, which showed analysts in general had turned more cautious.
Trinity Asset Management, Inc. by:
Brian Gilmartin, CFA
Portfolio manager