This Might Be The Best News From This Earnings Season

This Might Be The Best News From This Earnings Season
Carl Hazeley

17 days ago1 min

If you were looking for some reassuring news, this earnings season has so far delivered. Third-quarter results from companies in the S&P 500 have collectively come in stronger than expected, and as of the end of last week, have represented the first quarter of profit growth (as measured by earnings per share) in a year.

This chart from Goldman Sachs shows S&P 500 earnings per share (EPS) growth, on a year-over-year basis, which so far is up 4% (blue bars) for the third quarter and up 10% (gray dots) if you exclude the more volatile energy industry.

While sales outpaced investor expectations somewhat, the biggest driver of earnings growth has been higher-than-expected profit margins which, by and large, analysts expect to continue through the next few quarters.



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