Earlier this week, we asked readers whether second-quarter earnings will exceed or fail to meet expectations across the globe. CFA Institute Financial NewsBrief asked readers whether second-quarter earnings exceed or fail to meet expectations across the globe.
Earnings for the quarter that ended June 30 will:
The second-quarter-earnings season is well under way across the globe, and we asked readers earlier this week whether results will meet, exceed, or fail to meet expectations. Only 17% of respondents think earnings will be less than consensus expectations, whereas 44% think that earnings will exceed expectations. Whether this is a bullish sign or just an acknowledgment by readers that most firms are ace managers of their earnings is hard to tell.
In a similar poll last October, we asked readers whether profit margins in the US were likely to expand, contract, or stay the same in the next 12 months: 38% expected margins to contract and 20% expected expansion. Given the disconnect between these two polls and allowing for the passage of time, it seems that readers might be inclined to believe earnings management is a common practice. Regardless, equity markets have historically risen relative to earnings outperformance.
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