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The Truth About S&P 500 Earnings: No Growth For 7 Quarters, With A Revenue Recession On Top

Tyler Durden's picture




 

With the global economy sliding into recession, the one strawman repeatedly used by straight-to-CNBC pundits to justify some mythical case for US decoupling has been that US corporate profits are "fine." Here is the truth.

As the following table from ISI shows, not only is the US now officially in a revenue recession, with every single quarter in 2015 set to post a decline from the previous year, with even the overly optimistic consensus case of a 4% increase in Q1 2016 revenues unable to regain sales last seen in Q3 2014, but S&P500 expected earnings in Q1 2016 of 119, a 6% increase from the previous year, will barely be back to levels seen in Q3 2014. 

As ISI summarizes: "Expected Earnings for the S&P Show No Growth For 7 Quarters And Revenue Declining."

And this with nearly $1 trillion in projected stock buybacks for all of 2015 steadily removing S from the EPS calculation.

All we can add to the above is that if the USD continues its steady ascent, as it did today despite the Fed not hiking, expect ongoing dollar strength and the resulting commodity weakness to depress both revenues and sales even further, until everyone is forced to admit that the S&P500 is already in both a revenue and profit recession.

 

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Mon, 09/21/2015 - 20:17 | 6576924 knukles
knukles's picture

Well, I'd like to hear Jim Cramer's take on this. (sarc)
Then my grand-kids could get Stroke & Aneurysm dolls for Christmas

Mon, 09/21/2015 - 20:21 | 6576949 Toonces McGraw
Toonces McGraw's picture

Long amyl nitrate.

Tue, 09/22/2015 - 03:59 | 6577872 Keyser
Keyser's picture

No secrets here... The only way corporations have made their numbers with declining revenues is to cut costs and buy back shares, killing Capex and expansion... How do you like the idea of training your replacement,  who is a non-union H1B visa holder from Bangladesh?

 

Tue, 09/22/2015 - 07:54 | 6578120 taggaroonie
taggaroonie's picture

amyl nitrite there partner, tricky to get hold of, because the pharmacist suspects you're supplying gay nightclubs

Mon, 09/21/2015 - 20:35 | 6576992 NoDebt
NoDebt's picture

Jim said that pointing out falling revenues is 'unsavory'.

Is it any wonder why companies aren't investing in CapEx?  I wouldn't either.  Just keep buying back those shares until the next crash and then walk away.  (They read ZH, too.  They know what's up.)

 

Mon, 09/21/2015 - 20:18 | 6576935 Richard Chesler
Richard Chesler's picture

US Economic recovery.

As real as Obama's birth certificate.

 

Mon, 09/21/2015 - 20:37 | 6577000 NoDebt
NoDebt's picture

There's been nothing about the guy that hasn't been a lie from Day 1.  He's the Manchurian Candidate.  Only thing he didn't lie about was "fundamentally transforming the country".  Sure as shit didn't lie about that.  I don't even recognize the place any more.

Mon, 09/21/2015 - 20:44 | 6577028 LetThemEatRand
LetThemEatRand's picture

I hear you on the rest, but I don't think he fundamentally transformed anything.  Maybe he sped it up, but the country has been going down the shitter for a long time.  9/11 happened 14 years ago, and the bailout happened before Obama took office.  Obama is the worst since Lehman.

Mon, 09/21/2015 - 20:52 | 6577063 FreedomGuy
FreedomGuy's picture

Best series of comments in a long time. 

How do we unseal his college transcripts? My bet is that there is a lot of extremely revealing stuff there from attendance records, to grades to foreign student status.

Mon, 09/21/2015 - 21:42 | 6577276 NoDebt
NoDebt's picture

He was a crappy student, from all first-hand accounts I've heard.  Smart but reluctant to apply himself to the details and boring minutae.  He was put in the position of student president of the Harvard Law Review by CONSERVATIVES, who he immediately turned his back on and took sides with the "radicals" that he openly bragged about in his book.  More to the point, I think, is who BANKROLLED his education.  

Mon, 09/21/2015 - 23:07 | 6577553 Handful of Dust
Handful of Dust's picture

Infidels!

Mon, 09/21/2015 - 23:13 | 6577564 847328_3527
847328_3527's picture

Retail is taking a bloodbath the two local dept store managers told me last weekend. Not only are profit margins zippo, but they both complained about the increasing problem of what they call, "shrinkage" or theft of their stuff. Despite cameras, etc it is still pretty easy for people to steal belts, jewelry [a biggie!], shirts and even things like coats! One said his shrinkage rate is way above 8% and it ain't even Christmas time.

 

Barry has squashed the middle class consumer. I have no idea why he hates the American middle class so much.

Tue, 09/22/2015 - 00:03 | 6577648 BeanusCountus
BeanusCountus's picture

Being a crappy student is the only thing going for him. If he flunked keynsian 101 thats no problem. Wasnt worth paying attention to. The man's problem is thinking he is helping america. And he isnt. On any front. Our worst nightmare is that the next guy will be just as bad. Which is what all of them seem to do.

Tue, 09/22/2015 - 05:12 | 6577925 damicol
damicol's picture

Wanna know what will guarantee Trump as potus..

He just makes a cast iron pledge that he will open the fucking filthy faggot obummer file to the public, photos of him in the bathhouses fucking fat faggot white boys, birth certificate and the rest of the fraudulent lying sack of shits background including the fact that his mother was without question a monkey. 

Im sure she was,, either that of his fucking father, cos no way that cunt is the same as me, and human

Mon, 09/21/2015 - 20:26 | 6576953 clade7
clade7's picture

Heavy crap a flying me buckos!...there is no clear path, real skills will come in handy..and of course a metal detector and a wrist rocket.....learn to use both...that and a plastic tarp are 'bout all a guy needs...

Mon, 09/21/2015 - 20:30 | 6576979 Tinky
Tinky's picture

OT, but Koos Janen's latest post (linked below) is well worth a read. Here's a small taste:

Below you can see what I think is a significant screen shot from the BPM6 rulebook. The IMF has put Monetary gold right at the top of the global reserve assets list – above SDRs. The IMF writes, “…The gold bullion component of monetary gold is the only case of a financial asset with no counterpart liability”, and, “7.69 At the appropriate reference dates, reserve assets are valued in the main at current market prices. Monetary gold is valued at the prevailing market price, SDRs are valued at market rates calculated by the IMF, and deposits and loans are valued at nominal values.”

 

https://www.bullionstar.com/blogs/koos-jansen/the-london-bullion-market-...

Mon, 09/21/2015 - 20:39 | 6577009 Ness.
Ness.'s picture

Revenues and GAAP accounting are your only friends.  EPS and Non-GAAP figures are a joke.  

Mon, 09/21/2015 - 20:44 | 6577023 mastersnark
mastersnark's picture

LOL, everything looks bad if you use GAAP numbers, silly! It's why we don't use it...

Mon, 09/21/2015 - 21:09 | 6577123 Ness.
Ness.'s picture

That's similar to why CPI excludes Food and Energy - 'cause ya know? we don't really need food or energy.  

What pill was I supposed to take!?  Either way... I think I took the wrong one.

Mon, 09/21/2015 - 21:46 | 6577288 undertow1141
undertow1141's picture

Energy and food are just too volatile to measure any kind of real(snicker) inflation.(giggle) So we just don't count those anymore. (giggle) Next we'll remove housing costs and then we will know what inflation the serfs oh I'm sorry people deal with.

Tue, 09/22/2015 - 00:33 | 6577680 Wannabe_Oracle
Wannabe_Oracle's picture

Certifiably crazy, that's the only way I can explain it. Anyone with half of a brain knows that inflation is real and ever-increasing. Every time I hear talking heads, FED, whatever, talk about getting inflation up I go absolutely ape $hit - these people are delusional or intentionally lying. And, my annual salary increase never seems to keep up with annual inflation - I crunch the numbers quarterly!

Mon, 09/21/2015 - 20:52 | 6577064 CHoward
CHoward's picture

I don't believe there is any global recession or any thing bad going on.  What ever our leaders say is correct and true - I mean, it has to be - they represent US, right?

Mon, 09/21/2015 - 20:57 | 6577083 nidaar
nidaar's picture

I trust the government, too. Anyone who doesn't, should get the fuck out!

Mon, 09/21/2015 - 21:47 | 6577302 undertow1141
undertow1141's picture

I trust that the government has its own best interests in mind first over all. 

Mon, 09/21/2015 - 23:15 | 6577568 847328_3527
847328_3527's picture

I picked up a "Government" text book the other day in the bookstore. the very first sentnece was, "Always remember the number one purpose of the government is to keep itself in power."

 

Thank God America has the Second Amendment!

Mon, 09/21/2015 - 20:55 | 6577076 FreedomGuy
FreedomGuy's picture

What are the best guesses on Fed actions in October?

I guessed right on this last one. I am going to bet short of a stock crash they raise rates in October. It is not because of any economic analyses or any prime directives. It will be just to pretend they know what they are doing and make a show of being economically balanced. It will be a quarter point so as not to crash the markets and fragile economy.

It's not about science in the end. It will be about posturing and the pretense of being economic and monetary masters.

Mon, 09/21/2015 - 21:11 | 6577139 Wild Theories
Wild Theories's picture

I was originally thinking Jan 2016 for the same reasoning, but now I'm leaning Nov/Dec, simply because Gartman said "chance of rate rise this year seem very slim".

Oct will be too soon for the China influence to go away completely yet, Chinese stock market is bottoming, but the capital outflow and the fear of a "China collapse" in the west is still ongoing. So that's where I'm leaning Nov/Dec

Mon, 09/21/2015 - 21:48 | 6577308 undertow1141
undertow1141's picture

Goldman has already said it won't be til 2016. So............

Mon, 09/21/2015 - 21:04 | 6577115 yogibear
yogibear's picture

Hey James Bulltard and William Dudley, have your banker buddies use more of that Federal Reserve Ponzi money to buy more shares.

We are confident of QE4. Just waiting.... We already know you can't raise rates.

LOL, the 12 little pigs at the Fed keep threatening to raise rates. Never going to happen unless the market does it instead. 

 

Mon, 09/21/2015 - 21:14 | 6577162 CalibratedConfidence
CalibratedConfidence's picture

Mon, 09/21/2015 - 21:17 | 6577177 stant
stant's picture

Been no growth for about 30 yrs , just deficit spending

Mon, 09/21/2015 - 21:57 | 6577339 Ness.
Ness.'s picture

The other Ben ~ "No rate normalization in my lifetime."

Mon, 09/21/2015 - 21:22 | 6577213 Handful of Dust
Handful of Dust's picture

O'Bama destroyed America's middle class so don't expect any miracles until we get a new POTUS and replace half the brain dead there now. I wonder if Boner and McConnell are even conscious?! They sit there like dopes and let Piglosi and the other far left wing liberals roll right over them. Newt Gingrich is right when he says the government no longer represents the American people. I'll have to re-read his book for solace.

Mon, 09/21/2015 - 21:36 | 6577261 Xscream
Xscream's picture

And yet by 6am futures will all be green...........amazing 

Mon, 09/21/2015 - 21:52 | 6577316 undertow1141
undertow1141's picture

Like fucking fairy dust magic, through of all the bad news, the sun will rise over a green board. Like dice on a craps table that always flop snake eyes. Rigged.

Mon, 09/21/2015 - 21:41 | 6577275 TheRideNeverEnds
TheRideNeverEnds's picture

bullish

Mon, 09/21/2015 - 22:49 | 6577503 hawaiianPunch
hawaiianPunch's picture

I don't see anything but full retard. Stocks and housing will start to collapse without a rate hike, then QE 4... 5... 6... We'll see riots start somewhere in there. Hunger Games we go.

Tue, 09/22/2015 - 00:24 | 6577667 rita
rita's picture

Obama is a con, every time he speaks lately i feel he is taking the mickey of the American people. He fooled many but i never thought anything of the guy.

Tue, 09/22/2015 - 01:17 | 6577737 kaboomnomic
kaboomnomic's picture

I tought BAD NEWS is GOOD NEWS for Wallstreet??

Tue, 09/22/2015 - 03:30 | 6577852 hooligan2009
hooligan2009's picture

http://www.multpl.com/s-p-500-earnings/table

actuals headed south in 2q2015?

lots of volatility in actual numbers: 2006 eps adjusted for inflation = 96 v 100 for March 2015 = 4% earnings growth in 9 years to cherry pick a couple of numbers.

Consensus = bottom-up or top-down?

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