This page has been archived and commenting is disabled.

Visualizing Hope

Tyler Durden's picture




 

The chart below present the change in reported and projected corporate Revenues and EPS (excluding financial companies), and highlights the dramatic improvement in the economy expected by analysts over the next 2-3 quarters. In the next quarter things for companies get dicey with both revenue and EPS expected to be flat with Q4 of 2008. Whether or not this is attainable will be seen shortly. Yet where it does get just a little amusing, is 2 and 3 quarters in the future, when EPS are projected to increase by 23% and 20% respectively, while everyone hopes sales can wave a magic wand, and with skeleton crews of employees and no growth capex investments, are assumed to grow by 11.2% and 9.5%. Additionally, analysts are now forced to actually really ramp up their expectations in order for stocks to grow incrementally from here. If readers believe that corporate revenues in Q1 of 2010 can grow sales by more than 10% from Q1 2009 (while continuing to fire people), then by all means, buy stocks.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Fri, 10/30/2009 - 15:48 | 115480 RockyR
RockyR's picture

we'll see

Fri, 10/30/2009 - 15:53 | 115482 waterdog
waterdog's picture

Well that is our show for today folks. Tune in Monday for another informative episode of Baking with Ben. Our guests will be Timothy- I do not monetize- Geithner, who will demonstrate how to cut and fold stiffly beaten egg whites into a cake batter using a salad fork, and, Sheila- no matter what happens- Bair will show how to frizzle in a toaster oven.

And remember, just because something is half baked does not mean you cannot swallow it.

(crumpetwithtea thought this was tasteless. She has not liked me since I blogged her I thought a leavening agent was a spy with gas. You would be surprised how much humor an old lady can pack into a garbage disposal.)

Fri, 10/30/2009 - 16:04 | 115499 Danz Gambit
Danz Gambit's picture

Why Timmy stick with his 'No Plan B' formula?

Fri, 10/30/2009 - 17:02 | 115568 Anonymous
Anonymous's picture

Don't forget yeast raised Rham with the emulsifier!

Fri, 10/30/2009 - 15:56 | 115487 DaveyJones
DaveyJones's picture

"Additionally, analysts are now forced to actually really ramp up their expectations"

never knew "analysts" were crime victims

thought they were perpetrators

learn a lot on this site

Fri, 10/30/2009 - 15:58 | 115492 lizzy36
lizzy36's picture

With the right amount of hopium one can visualize anything.......

spy under 104 and spx under 1039 - and cramers head exploding on the 4 whatevers of the nasdq taking a collective dump.

Fri, 10/30/2009 - 16:03 | 115498 Sec.NotSure
Sec.NotSure's picture

Sometimes a dump can be so relieving cant it...I mean stocks....err uhhh yeah...

Fri, 10/30/2009 - 16:44 | 115546 Anonymous
Anonymous's picture

Loved it Sec.notSure - hilarious !!

Fri, 10/30/2009 - 16:09 | 115504 Stoploss
Stoploss's picture

Off topic, but heard something about govt lending directly to small business.

Anyone else?  Or maybe im losing whats left of my mind.

CIT could file this weekend.  No need to bail out if the fed is primary lender.

Fri, 10/30/2009 - 16:27 | 115524 deadhead
deadhead's picture

obama pushing banks to lend more (they won't).  look for the sba to start lending directly versus the current paradigm......  subprime business loans coming up.

Sat, 10/31/2009 - 18:14 | 116251 Stink_Pickle
Stink_Pickle's picture

I fear that you're correct, dh.  I am always dumbfounded when policy makers believe they can manipulate and outsmart markets.

Fri, 10/30/2009 - 16:10 | 115506 AR
AR's picture

The gyrations of "visualizing hope" versus reality (this is funny, as I suspect most of us at one time or another in our careers have in their own way, experienced it). We all have been wrong. In fact, probably we all have almost blown ourselves up a few times over the years. A bad trade, investment or macro thesis -- usually develops like this, whereby, it always seems to "mask itself" inside the definition of HOPE.  Here's what we've learned. A bad trade usually starts off like this: (1) Oh, it's OK. (2) This is not good. (3) This is bad. (4) This is really bad. (5) This is DISASTEROUS. (6) I think we're almost out of business.  Moral: Learn from other's when they tell you to use stops, to be disciplined, and to liquidate a bad trade or thesis no later than step #3 above. HOPE doesn't really have a place in successful investing. Lastly, the majority of analysts on Wall Street are sheep, not cutting edge, forward thinking minds protecting us from "visualizing hope." Funny... I can still remember those trades after 30 years (taste them too). Good luck everyone. Have a good weekend. Special thanks to Tyler and ZH staff also.

Fri, 10/30/2009 - 16:28 | 115526 deadhead
deadhead's picture

great words of wisdom AR.  thank you.

Fri, 10/30/2009 - 16:53 | 115562 Screwball
Screwball's picture

Well done Sir.

Fri, 10/30/2009 - 17:59 | 115626 DaveyJones
DaveyJones's picture

"HOPE doesn't really have a place in successful investing"

or regulating, prosecuting or governing

Fri, 10/30/2009 - 23:09 | 115867 spekulatn
spekulatn's picture

I can still remember those trades after 30 years (taste them too).

 

OUTFRIGGINSTANDING stuff AR.

 

"MARK IT ZERO, DUDE"

 

Fri, 10/30/2009 - 16:10 | 115507 hp12c
hp12c's picture

Companies will try to squeeze the sponge to wring more EPS on flat or declining revenues for only a few quarters....then it's put up or shut up...

Fri, 10/30/2009 - 16:17 | 115513 aldousd
aldousd's picture

This is very enlightening! Nice idea!

Fri, 10/30/2009 - 16:18 | 115515 ShankyS
ShankyS's picture

It is going to be fast and brutal. There will be one last pop, and at the top of wave 2 of P3 (using EWT terminology for simplicity's sake) will be the last exit for the longs and if they fail to take that opportunity......sorry. We have screamed loud enough and long enough. Maybe the web is a reliable source of information afterall. (IMO, the digital dickweeds day (months/years) in the sun.)

Fri, 10/30/2009 - 16:29 | 115528 deadhead
deadhead's picture

kenny and the crew at his site are great....i always read your stuff shanky.

 

 

Fri, 10/30/2009 - 17:37 | 115610 max2205
max2205's picture

OMG, earnings = FASB ect. Do we still think Co's are not cooking the books. See IRS anncmt on greater Co audits to collect 350 B this year. Once they get done with payroll errors (ha), they will notice bigger errors.

Fri, 10/30/2009 - 19:18 | 115700 Anonymous
Anonymous's picture

i'm visualizing world crap......

Fri, 10/30/2009 - 19:27 | 115711 InExile
InExile's picture

Hope is for dopes.  VIX over moving averages, asset correlation up, munis on the edge.  Look out. Tired of DC Happy Talk.

 

Fri, 10/30/2009 - 20:59 | 115777 Anonymous
Anonymous's picture

Sooo, how's that hopey changey thing treatin' ya?

Sat, 10/31/2009 - 05:53 | 115982 Hephasteus
Hephasteus's picture

Could someone projecte and extrapolate me a pony while they are at it.

Do NOT follow this link or you will be banned from the site!