Earnings season is almost over with 84% of S&P 500 companies having 
reported. 73% beat earnings expectations and 53% beat revenue expectations. Revenue growth reached 7% last quarter.
Best earnings growth were in Financials (+64%), Consumer Discretionary (+21%) and IT (+20%).
Q4 operating earnings total $17.34 or $69.36 annualized although trailing 12 month eps are $57.04, weighted down by the $10.11 eps in Q1. Q4.Q3 eps are up 10%.
2010 estimates keep rising and are now $78. Only getting rid of Q1 2009 will boost the 2010 figure by $7. Nevertheless, analysts 
forecast Q4 2010 eps to rise 22% YoY, obviously a tough goal if US final demand does not recover. Inventory restocking will only go so far.
In fact, analysts have become more cautious recently and Q1/2010 earnings revisions have been trending down in 7 of 10 sectors.
Corporate executives are not as cautious, however, as earnings guidance is very strong.
When I did my last equity valuation post on December 8 (US EQUITIES VALUATION ANALYSIS: DUCK, YOU (HAPPY) SUCKERS!), Q4 2009 estimates were $16.75; actual eps came in 3.5% higher. Estimates for 2010 have risen 4% since then while the S&P 500 Index is essentially unchanged.
I will soon take another look at earnings and valuations.
Related posts:
