click for larger graphic

Source: J.P. Morgan


We will see if this changes this quarter, but so far, so good with earnings . . .

Category: Digital Media, Earnings

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

6 Responses to “S&P 500 Year-Over-Year EPS Growth”

  1. cdub says:

    I dunno, looks like a steeply decelerating EPS growth curve. Help me out: how is this good?

  2. rd says:


    It is good because the market has been going up which means it is good. 1998 to 2000 proved that earnings are not necessary for stock market growth.

  3. boden11 says:

    ^^ Exactly, I had to reset my forgotten password just to jump on here to say this. Declines for the last 5 quarters in a row and basically at 0. How is this good? Based on past history it looks like a dip into negative growth (recession lite) could easily happen.

  4. jhawkins90 says:

    and margins already turned negative… looks like margins are the leading indicator here, only false signal in this data from Q3 96.

    And of course, we all need to remember how far margins can fall in this market, as Hussman keeps remind us.

  5. hammerandtong2001 says:

    Certainly reading tea leaves…

    But, I believe the point is that recession-symptomatic earnings collapses, as seen in 2000 and 2007, had extreme economic fallout (negative growth, significant net job loss, etc.). And that’s really bad.

    However, earnings growth “dips” as seen in 1996 and 1998, were far less severe with much milder economic consequences with a rbound signalling a return to growth. Additionally, these “dips” did not derail equity markets, and generally, the markets went higher. And that’s not so bad, and might even be good.

    The point: perhaps we are experiencing the latter, as earnings growth so far, is reasonably OK.


  6. mad97123 says:

    GMO’s James Montier Explains The True Source Of Today’s ‘Freakish’ Corporate Profit Margins

    “Profits = Investment – Household Savings – Government Savings – Foreign Savings + Dividends

    See the big source of profits? Yep, it was the government’s monster negative savings. Or to put it another way, it was the huge deficit equalling 7.6% of GDP that really boosted corporate profits.”

    In theory this is a trend that should be reversing in a country near you.