75% of S&P 500 Companies Report 2Q Upside Surprises

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Aug. 8 (Bloomberg) –- Bloomberg’s Douglas Lavanture discusses earnings surprises from S&P 500 companies with Julie Hyman on "Street Smart.” (Source: Bloomberg)

You have three quarters of companies pretty much regularly beating what analysts had anticipated.

A longer run average has been 68%. 75% is surprising.

What also makes it surprising is what you will see before earnings is a trickle-down and analyst estimates as far as eps goes.

They get more pessimistic as we get closer.

They will get significantly more pessimistic.

They will generally cut at 7.5%. in the first quarter of 2014 analysts actually lessened these analysts than they had a prior.

They only caught them by 3.5. they were more optimistic going into the earnings season.

And in getting that 75% eat is even more positive on top of that.

That is one way to read into it.

There are these types of companies to that analysts habitually underestimate, which you mentioned earlier.

Either analysts are not getting it quite right or the company is not managing expectations correctly.

Let's keep it real.

A company management -- even analyst catering to their clientele are going to be a little more conservative than their estimates for earnings.

It is not surprising you do see these types of numbers coming out.

We look at the s&p 500 companies that eat their analyst earning estimates.

Of those 22 companies have beaten 19 or 20 times in each of the last 20 quarters.

With priceline group, we have sandisk.

These are all big companies.

A big wide spectrum.

Companies across different industry groups.

What is interesting about this time around and what makes it different from the first quarter is there is a friends in how these companies are responding or how the company stocks are responding to the presence.

In the first quarter they actually increase in the five days following.

The stock price went up.


This quarter, eat out of the 10 of them, even though they all beat aps analyst estimates -- if you beat estimates it does not mean the stocks will go up.


If they do go up there may be some more room to go down.

Thank you so much.

A pleasure to talk to you about

This text has been automatically generated. It may not be 100% accurate.


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