{"id":4015,"date":"2014-08-22T22:07:06","date_gmt":"2014-08-22T22:07:06","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=4015"},"modified":"2014-08-22T22:07:06","modified_gmt":"2014-08-22T22:07:06","slug":"8-22-14-sp-500-weekly-earnings-update-q2-14-earnings-season-is-over-growth-was-good","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=4015","title":{"rendered":"8.22.14: SP 500 Weekly Earnings Update: Q2 &#8217;14 Earnings Season is Over, Growth Was Good"},"content":{"rendered":"<p>According to Thomson Reuter&#8217;s This Week in Earnings, the forward 4-quarter EPS estimate for the SP 500 fell\u00a0$0.25 this week to $126.33, versus last week&#8217;s $126.58.<\/p>\n<p>The p.e ratio on the forward estimate given the 1.71% SP 500 rally is now 15.75%.<\/p>\n<p>The PEG ratio rose to 1.70(x) versus last week&#8217;s 1.64(x).<\/p>\n<p>The &#8220;earnings yield&#8221; on the SP 500 fell to 6.35%.<\/p>\n<p>The year-over-year growth of the forward estimate fell for its 4th consecutive week, to 9.25%, down from last week&#8217;s 9.40%.<\/p>\n<p>With 486 companies having reported q2 &#8217;14 earnings, for all practical purposes q2 &#8217;14 earnings season is over.<\/p>\n<p>The year-over-year growth rate for actual q2 &#8217;14 earnings was 10.2%, which is pretty healthy growth, the best since late 2011.<\/p>\n<p>q2 &#8217;14 revenue growth of 4.6% was also the best in the last few years.<\/p>\n<p>Here is our excel spreadsheet simply tracking SP 500 revenues by sector: <a href=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/2014\/08\/FCSP500revgroqtrly.xls\">FCSP500revgro(qtrly)<\/a><\/p>\n<p>The sectors that caught my eye in terms of revenue growth are Healthcare, Energy (upside surprise) and Basic Materials. Health Care is in large part driven by biotech.<\/p>\n<p>Q3 &#8217;14 earnings growth rates are finally starting to see the typical reductions, with 5 weeks left in the quarter.<\/p>\n<p>Since July 1 &#8217;14, q3 &#8217;14 SP 500 earnings growth has been cut from 11% to 8.3% as of Friday, August 22nd.<\/p>\n<p>Only Healthcare has seen higher revisions for q3 &#8217;14 since July 1, from 10.5% to 11.2%.<\/p>\n<p>Our final comment this week is about Financial&#8217;s: because JP Morgan took that huge charge last year in q3 &#8217;13 for legal fees, which resulted in GAAP EPS for JPM of ($0.17) versus core or operating EPS of roughly $1.24. Now with Bank of America poised to take a $16 billion charge for Countrywide mortgage fraud issues, the +20% growth the Financial&#8217;s were looking at for q3 &#8217;14, will likely be reduced.<\/p>\n<p>Financials could be setting up for a decent 2014, if only from a clean earnings perspective. We&#8217;ve never been big insurance investors, but we do like the big banks, the exchanges, and the asset gatherers like Schwab, etc. (Long JPM, Bank of America and Schwab.)<\/p>\n<p>Thanks for reading. We&#8217;ll have more over the weekend.<\/p>\n<p>Trinity Asset Management, Inc. by:<\/p>\n<p>Brian Gilmartin, CFA<\/p>\n<p>Portfolio manager<\/p>\n","protected":false},"excerpt":{"rendered":"<p>According to Thomson Reuter&#8217;s This Week in Earnings, the forward 4-quarter EPS estimate for the SP 500 fell\u00a0$0.25 this week&hellip;<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[38,109,112,3,89,95,84,53,92,27,9,36,98,91],"tags":[],"class_list":["post-4015","post","type-post","status-publish","format-standard","hentry","category-bac","category-biotech","category-biotech-sector-earnings","category-earnings","category-earnings-estimate-revisions","category-energy-sector","category-financial-sector","category-financials","category-fwd-4-qtr-growth-rate-sp-500","category-jpm","category-sp-500","category-schw","category-sector-earnings-growth-estimates","category-weekly-earnings-update"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/4015","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=4015"}],"version-history":[{"count":7,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/4015\/revisions"}],"predecessor-version":[{"id":4023,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/4015\/revisions\/4023"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=4015"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=4015"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=4015"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}