Approximately 92% of the S&P 500 companies have reported earnings for the first quarter (as of 5/8/14). Total earnings for those companies is up 1.6% from the same period last year on a +0.6% increase in revenue. Approximately 69% of those companies beat their Earnings per Share estimates and about 50% have come out with positive revenue surprises.
These figures would have actually been significantly better if the Finance sector wasn’t such a drag on earnings. If we exclude the Finance Sector from the reported first quarter results, total earnings would have been up 4.0 and the revenue increase number would have been +3.3%.
For the first five weeks of the second quarter of 2014, we have seen earnings revisions of -2.2%, which is a lower drop than the 3.3% drop in the second quarter of 2013. It is also below the 3.1% drop for the comparable period of the first quarter of 2014.
There are no facts or circumstances in these numbers that would lead us to believe that a considerable, sustained pull-back is coming for the markets. However, stay tuned as this information does (and will likely) change.