Due to some pressing matters, the blog post will be short and sweet this weekend.<\/p>\n
The “forward 4-quarter” earnings estimate for the S&P 500 as of Friday, was $108.00 even, versus a slightly lower number last week, as the forward estimates continue to hover around the $108 – $109 level.<\/p>\n
The recent high was $111 around July 14th, and the recent low for this key metric was $105 as of late March, 2012.<\/p>\n
Q3’12 numbers start getting released around October 10th, and the 3rd quarter estimates continue to expect -1% to -2% year-over-year eps growth on flat to -1% revenue growth. These numbers havent changed in some time.<\/p>\n
The q4 ’12 eps estimate for the S&P 500 is still expecting +10 growth.<\/p>\n
We continue to believe that q3 ’12 will be the nadir in terms of earnings for this post ’08 – ’09 rally, and that earnings should continue to grow in q4 ’12 and into 2013.<\/p>\n
This week, we hear from Lennar Monday morning before the bell, and then Nike on Thursday and Walgreen’s on Friday.<\/p>\n
I continue to be impressed with how the stock market absorbs bad news. Check Rockwell-Collins (COL) action on Friday. The defense company pre-announced on Friday morning thanks to fiscal cliff issues and the stock finished up on the day on heavy volume. KB Home reported earnings Friday morning, and had a monster day – up 16% – on 6(x) average volume. We previewed Lennar’s results over on Seeking Alpha, and may have been too conservative. The issue with the homebuilders (in my opinion) is “normalized earnings” – most of these companies sport effective tax rates that are abnormally low. Currently, many of the homebuilder stocks – like Lennar\u00a0 – are trading off 2014 and 2015 valuations. But we are very early in the cycle too.<\/p>\n