Revenue And Earnings Growth Continue To Slow
Blog of HORAN Capital Advisors | Sep 13, 2012 01:41AM ET
One of the services provided by Thomson Reuters (TRI) is they aggregate financial data from analysts. TRI recently updated/aggregated all the analyst data as it relates to earnings and revenues for the S&P 500 Index companies for the third quarter. TRI notes:
...companies in the S&P 500 are likely to post the slowest annual revenue growth rate [for Q3] in the last decade (barring the 2008/2009 financial crisis) and the trend seems to be getting worse, with more disappointments in store.
In order for companies to continue achieving earnings growth, they have to be focused on the cost side of their business. Unfortunately, companies can only cut costs for so long before this avenue to increase earnings comes to an end.
Indeed, this reality may be setting in for Q3 2012 earnings. As the below chart details, Q3 earnings are expected to decline by 2.0%. It is likely, Q4 earnings are being revised lower as well. The second chart shows the trend in fourth quarter earnings growth.
TRI discusses the potential consequences of this slowdown in the below video.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.