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Meanwhile, Goldman strategists are predicting this quarters earning season will be the worst for profits/EPS since the start of the pandemic. > Earnings per sh

by krona 4y ago

Meanwhile, Goldman strategists are predicting this quarters earning season will be the worst for profits/EPS since the start of the pandemic. > Earnings per share are expected to decline 7% year-over-year, according to a note from the bank published this week, along with a "significant deterioration" from the -1% year-over-year growth posted in the last three months of 2022. https://www.businessinsider.in/stock-market/news/investors-should-brace-for-corporate-profits-to-see-their-biggest-drop-since-the-start-of-the-pandemic-goldman-sachs-says/articleshow/99306146.cms https://www.businessinsider.in/stock-market/news/investors-s...

capybara_2020 4y ago
Numbers like this are really confusing. Ok there is an year on year decline of 7%. But how does that compare to previous years? Did they grow dramatically and now they are losing some steam? Or has it been declining for the last few years? One of the biggest losers is supposed to be healthcare(20%). Is that because they had a huge spurt because of the pandemic and now there is a reduction? I am not sure what the other industries are so I am not sure what to make of it.
rhaway84773 4y ago
Your statement is factually wrong. The article doesn’t claim Goldman strategists are predicting the worst quarter for profits/EPS since the start of the pandemic. They are predicting the steepest YoY decline in profits/EPS. By about 7%. There’s a huge difference. What they’re predicting probably means profits will still be a lot higher than many quarters in the pandemic, and much higher than Pre-pandemic profits. https://ycharts.com/indicators/sp_500_eps https://ycharts.com/indicators/sp_500_eps Most of the 2010s had EPS in the 20s. The late 2010s (2018 onwards…right after the massive tax break incidentally) has an EPS in the 30s. It drops to the teens in the beginning of the pandemic, rising to peak above 50, and is still in the mid 40s. A 7% drop would still keep EPS in the 40s, well above anything it touched Pre-pandemic. What’s worst is that this is with the backdrop of a much stronger dollar than ever, which means that these dollar earnings are increasing after compensating for conversion losses from the RoW, which indicates American consumers are being charged a lot more money.

by krona 4y ago

capybara_2020 4y ago

Numbers like this are really confusing. Ok there is an year on year decline of 7%. But how does that compare to previous years? Did they grow dramatically and now they are losing some steam? Or has it been declining for the last few years? One of the biggest losers is supposed to be healthcare(20%). Is that because they had a huge spurt because of the pandemic and now there is a reduction? I am not sure what the other industries are so I am not sure what to make of it.

rhaway84773 4y ago

Your statement is factually wrong. The article doesn’t claim Goldman strategists are predicting the worst quarter for profits/EPS since the start of the pandemic. They are predicting the steepest YoY decline in profits/EPS. By about 7%. There’s a huge difference. What they’re predicting probably means profits will still be a lot higher than many quarters in the pandemic, and much higher than Pre-pandemic profits. https://ycharts.com/indicators/sp_500_eps https://ycharts.com/indicators/sp_500_eps Most of the 2010s had EPS in the 20s. The late 2010s (2018 onwards…right after the massive tax break incidentally) has an EPS in the 30s. It drops to the teens in the beginning of the pandemic, rising to peak above 50, and is still in the mid 40s. A 7% drop would still keep EPS in the 40s, well above anything it touched Pre-pandemic. What’s worst is that this is with the backdrop of a much stronger dollar than ever, which means that these dollar earnings are increasing after compensating for conversion losses from the RoW, which indicates American consumers are being charged a lot more money.