What's Wrong With This Profit Picture?

A warning to readers of BUSINESS WEEK's flash report on fourth-quarter profits: Yes, earnings are up 78% over a year ago--even in cluding IBM's wretched numbers. But that says more about the weakness of 1991's last quarter than the strength of 1992's. For example, in 1991 Nynex Corp. and US West Inc. took restructuring charges of more than $500 million apiece. Both report much healthier 1992 results. Sixteen other companies had similar stories. Eliminate them, and profits overall declined 7% from '91 levels. Wall Street's forecasts were 33 a share too high--but only 4 if you leave out IBM.

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