Revenue Is Weak, Earnings Guidance Slightly Lower
Saxo Bank | Apr 26, 2013 03:21AM ET
The first quarter earnings season is in its blockbuster week, and as of Thursday, 258 S&P 500 companies reported earnings. The earnings surprise rate is 74 percent so far, which is on par with the previous earnings season since te recovery began in 2009. Prior to this earnings season's commencement, revenue in the first quarter was likely to be weak and has been so far. The revenue surprise ratio is at 45 percent highlighting the impact of the weaker global economy from late last year. Please note that there is approximately a six month delay from global economic activity to revenue recognition at global companies. Early next week we will dive deeply into all the earnings figures and make comments on the aggregate growth figures for revenue and profits. This will include trends in margins and growth rates split between the 10 sectors.
Finally, it is worth noting that 12-month forward EPS figures have declined slightly since the earnings season began a couple of weeks ago. Naturally, this reflects either unchanged or slightly weaker guidance than anticipated. The 12-month forward P/E level is currently 14.0x, reflecting confidence in earnings growth not seen since April 2010.
Next week's most important earnings releases
Monday: Eaton Corp, Luxottica Group, Atlas Copco, Express Scripts
Tuesday: Anheuser-Busch InBev, UBS, Deutsche Bank, BP, Lloyds Banking Group, Pfizer
Wednesday: Novo Nordisk, Merck, Visa, Comcast, Mastercard, Time Warner
Thursday: Siemens, BMW, Deutsche Lufthansa Infineon Technologies, Sanofi, BG Group, Royal Dutch Shell, Statoil, Gilead Sciences, AIG
Friday: BNP Paribas, Royal Bank of Scotland (RBS), Berkshire Hathaway, Duke Energy
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