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Look out for margins this earnings season
We are about 19 percent through this earnings season – so how exactly are we doing? Overall, Saxo Bank's Peter Garnry says are looking good and revenue growth compared to last year is a bit better than anticipated.
In fact, the earnings positive surprise ratio is currently at 71 percent - which is in line with previous quarters.
In particular, banks have done better than he anticipated – excluding JPMorgan which was hit “enourmously by litigation costs. Bank of America is one of the companies he would like to highlight for investors, as “they have strong numbers across the board" despite higher mortgage rates.
The have been two rather "disappoining" companies though; Safeway and IBM. The latter was a surprise to Peter because he had expected IBM to perform better given global growth.
Next week, it's all about energy and industrial companies. Peter's top tip would be to look out for margins. Revenue may be better than he had thought it would be this season, but he warns it’s still growing "very slowly", so this "requires a stable margin for earnings to continue to grow".
Read more about Peter’s predictions here:
http://www.tradingfloor.com/posts/done-deal-please-119327791
01:52 minutes
Tags: bank of america, banks, companies, company, earnings, earnings ratio, earnings season, economy, equities, equity, financials, global economy, global growth, growth, ibm, jpmorgan, margins, mortgage rates, mortgages, peter garnry, revenue, revenues, safeway, saxo bank, saxo tv, stock markets, stocks, tradingfloor.com, us banks