Jan. 30 (Bloomberg) -- Almost 80 percent of Standard & Poor’s 500 Index companies have posted profit that exceeded analysts’ estimates so far this earnings season, as results from Facebook Inc., Visa Inc. and Viacom Inc. provided further evidence of a strengthening economy.
With more than 50 S&P companies reporting today alone, the ratio in the benchmark gauge for American equities beating projections has reached about 79.5 percent, up from 77 percent yesterday, according to data compiled by Bloomberg. Almost half of the index’s members have now posted results, the data show.
Facebook, the world’s largest social network, said after the close of trading yesterday that it reached a milestone last quarter by getting more than half of its advertising revenue from mobile devices, while Visa benefited from an uptick in consumer sentiment that fueled purchases on cards. Economic data released today also underscored a pickup in spending by Americans, which helped the U.S. economy expand at a 3.2 percent pace in the fourth quarter..
“There is a fair amount of strength in the economy,” said Nariman Behravesh, chief economist at IHS Inc. in Lexington, Massachusetts, who was the second-best U.S. forecaster of the economy in the past two years, according to data compiled by Bloomberg.
Profit growth at S&P companies probably accelerated for a third straight period last quarter to 6.6 percent from a year earlier, estimates compiled by Bloomberg show. The gains helped push the index to a record last year, and so far in the season earnings are exceeding estimates at a faster than the 75 percent pace in the third quarter.
Viacom, the New York-based media company controlled by billionaire Sumner Redstone, topped profit estimates after sales rose at cable-television networks including Nickelodeon. Qualcomm Inc., the largest maker of mobile-phone chips, also reported higher-than-projected earnings, as more consumers worldwide choose phones that use its technology to connect to high-speed data networks.
Almost two-thirds of information-technology companies have released fourth-quarter results, and so far 90 percent of them exceeded earnings projections, data compiled by Bloomberg show.
In the defense industry, Raytheon Co., the world’s largest missile maker, and Northrop Grumman Corp. both beat earnings projections today even as sales dropped.
Oil companies posted mixed results. Houston-based ConocoPhillips, which has been selling and spinning off assets to focus on oil and gas production, topped estimates, while Exxon Mobil Corp., the world’s largest oil producer by market value, saw profit drop the most in four years as it pumped less natural gas from wells and energy prices stagnated. Earnings per share at the Irving, Texas-based company were in line with analysts’ projections.
Google Inc. and Amazon.com Inc. are scheduled to report later today, followed by MasterCard Inc., Chevron Corp. and Mattel Inc. tomorrow.
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