US Earnings Season Outlook

<p>As we start to delve into the third quarter US earnings season, which is the most important earnings season this year for a number of […]</p>

As we start to delve into the third quarter US earnings season, which is the most important earnings season this year for a number of economic and political reasons, we highlight the top 10 earnings to watch for coming weeks.

First and foremost, there is one key factor to take into consideration when trading in and around this earnings season – expectations.

In recent weeks, bellwether stocks such as Caterpillar and Intel have announced profit warnings, whilst a number of European listed mining companies such as Rio Tinto and BHP Billiton have recently advised shareholders of a faster slowdown in metal demand from China, a crucial market for the global economy.

Now whilst from the outset this may heighten fears of a weak earnings season in the US, we must remember that earnings seasons are not merely about the numbers, they are about what the market expects. A firm can deliver poor numbers but still see their respective share price rally if it beats the street’s consensus. The various profit warnings we have seen of late has surpressed market expectations. Investors are not expecting companies to superbly trump the street’s consensus estimates. This can play into the hands of companies reporting.

There is another element however to look at this earnings season – forecasts. With severe economic headwinds pressuring global growth, forecasts for the upcoming quarters or year end that come in at the bottom end of previous guidance ranges will also play strongly on investors minds as results are digested.

Our Top 10 Earnings to Watch:

Company Date Earnings Per Share (EPS) -Reuters Estimate
JP Morgan Chase & Co 12th October 2012 $1.21
Citigroup 15th October 2012 $0.97
Goldman Sachs 16th October 2012 $2.18
Intel 16th October 2012 $0.50
Bank of America Corp 17th October 2012 $0.07
Google 18th October 2012 $10.57
Microsoft 18th October 2012 $0.57
General Electric 19th October 2012 $0.36
Apple 25th October 2012 $8.89
Exxon Mobil Corp 1st November 2012 $1.92

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