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Handicapping the Earnings Outlook
The overall earnings picture remains positive, with companies handily beating consensus estimates and providing reassuring outlook for the coming periods. There are pockets of weakness, as reflected in the soft results from the likes of Discover Financial (DFS - Free Report) , Tesla (TSLA - Free Report) and others. But in the aggregate, the Q4 earnings and revenue growth pace represents an acceleration from the last couple of quarters.
Including this morning’s results, we now have Q4 results from 387 S&P 500 members or 77.4% of the index’s total membership. Total earnings for these companies are up +5.1% from the same period last year on +3.4% higher revenues, with 79.1% beating EPS estimates and 65.1% beating revenue estimates.
This Q4 earnings and revenue growth pace is notably better than what we had seen from this group of companies in the last few quarters.
Estimates for the current period (2024 Q1) are coming down. But the pace and magnitude of negative revisions compare favorably to what we had seen in the comparable period to the Q4 earnings season.
For more details about the Q4 earnings season and the overall earnings picture, please check out our weekly Earnings Trends report here >>> Q4 Results Paint a Positive Earnings Picture