Continues here


Source: Earnings Season Update, BofA Merrill Lynch

Category: 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.

3 Responses to “Best earnings growth in three years”

  1. sandden says:

    I believe your chart shows the best earnings PER SHARE growth in 3 years. Not the same as the best earnings growth in 3 years. Cheap money can result in large buybacks.

  2. Lamont says:

    Those are “operating earnings”, not GAAP earnings. It’s funny how much money companies can make when they don’t count their losses. Also interesting how much money companies can make by lowering their interest expense to almost nothing (thanks fed) and by evading US corporate taxes (hopefully that ends soon).

  3. spencer says:

    In my models an important determinate of earnings is the spread between unit labor cost and the deflator for nonfarm business.

    Over the last year or two it has been narrowing — a normal cyclical development.

    But with the drop in 1st Q real GDP, productivity collapsed and the profit margin spread turned negative.

    With 4% real GDP growth and about a 4% gain in second quarter hours worked, productivity in the second quarter will be weak, but still much better than in the first quarter.

    Consequently, the profit margin spread will be weak, but it will still demonstrate a major improvement over the deeply negative first Q number.

    The year-over year profit margin spread will barely be positive, and could even turn negative.