Fourth-Quarter U.S. Corporate Earnings Outlook

From Profit Confidential
January 21, 2013 - 11:56am

Companies in key stock indices like the S&P 500 have started reporting their corporate earnings for the fourth quarter of 2012. There is a heavy concentration of earnings in a small number of S&P 500 companies. Only 10 companies in the S&P 500 make up 88% of all corporate earnings for the index as per Morgan Stanley research; the other 490 companies only make up a menial 12% of the total corporate earnings of the S&P 500. (Source: Business Insider, November 26, 2012.) According to Thompson Reuters, fourth-quarter corporate earnings for S&P 500 companies are only expected to grow 1.9% year-over-year. Only three months ago, this earnings estimate was as high as 9.9%; this past summer, fourth-quarter 2012 earnings were expected to be 13.7% higher than fourth-quarter 2011 earnings. (Source: Streetwise, January 12, 2013.) Since it’s still early, not many companies in the...


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