Sunday, October 24, 2010


Earnings come much better than expected this quarter. So far, 83% of companies have overcome the analyst expectations. This is an incredible figure to the historical average of 62%. But as I said the other day with release of earnings from Apple, it is more important to look under the hood it must take these figures at face value. After all, "better than expected" may simply reflect the underlying low estimates and the strength of the actual data.

(Image source: CNN)

The best way to measure organic growth in corporate profits is to look at the top line growth. Revenue per share rose 10.9% of the pit in December 2009 and remain 12.75% at their Summit - a recovery, but resumed with a lot of work to be done before we can say that America was completely restored.7% This quarter to growth of the year is a little higher than 6% per year of last quarter figure of the year it is a positive trend. But to consider more in detail revenues tells the story of two very different economies.

In my intense focus on the national recession I've not focused enough on resistance to abroad, particularly in Asia. No doubt revenues have rebounded in any corporate America, but inland revenue is hardly robust at this stage. It has been felt in all gains far we have seen consistent reports strong international recipes and more lower domestic revenues.Average daily package volume ups in yesterday was highlighted cette.alors they showed 3.5% per year over year growth in the Canada, their international growth was 13.7%. This is very important. While we see deflationary trends in developed countries, we continue to see inflationary trends in emerging countries.

This early earnings preview shows that results are significantly better than expected and revenues are surprising upside down nicely.Although most revenue recovery occur abroad, it is a positive sign anyway you cut it the profits of the business. If this trend continues it would be positive for the market to work, however, because the price reductions have largely contributed to the bottom line (33% each year EPS growth so far this quarter) there is no greater urgency for firms to hire companies .the can sit on their fat and churn the nice profit margins until they are certain that revenues are stabilized and it is necessary for the expansion of the hand of work.

It will be crucial for the review of the future strength of the economy to United States .this margin expansion has created the flexibility which is good for companies and bad for millions of people who remain unemployed because it probably means the rise of the trenches position will be a long way. This situation has been beautifully summarized by Caterpillar yesterday in their earnings release:

I am pleased that we have so many people back to work this year, and with global economic growth continues, add us people in 2011 but remain perfectly centered on the control of costs. Although we expect a positive economic growth to the United States, recovery is lower than that we have seen in the past, especially taking into account the depth of the recession in 2009. “

In other words, they look carefully for hire, but have no great urgency because they remain concerned about the prospects for the economy and margins remain the number one priority.It emphasized signs of continued weakening of the domestic economy and earnings growth supported by Asian growth and margin expansion.


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