Companies are expected to grow profits during third quarter, but not revenue, according to one strategist. ‘We have three-quarters of companies beating earnings per share targets and 50 percent of them beating the revenue growth,’ said Randy Frederick, managing director of trading at derivatives at the Schwab Center for Financial Research, based in Austin, Tex. ‘But that’s because the targets keep getting lowered.’ In Frederick’s view, for the economy to get back on track, revenue growth is needed. ‘I don’t think we’re going to see that this quarter,’ he added. So don’t let a company’s Street beat fool you. ‘Even if a company beats its earnings target, if they give cautious guidance, they’ll probably selloff and we saw that in the first and second quarters,’ Frederick added. Third quarter earnings unofficially begin on Thursday, with Alcoa (AA) reporting financial results after the market closes. TheStreet’s Scott Gamm reports from New York.
More from Video
Amid the Selling, Here's the Big Question Now
How quickly do we find support, is what we'll want to know now, as the correction is occurring while economic optimism builds.
One Tweet Pulls the Rug Out From Under the Indexes
Despite the president's promise of no stimulus until after Nov. 3, there are no signs yet that this is the sort of correlated selling that leads to a deep correction.
A Technical Look at the New Dow Jones Industrial Average
Salesforce, Amgen and Honeywell will give a lift to the DJIA going forward.
Conagra Brands Looks Tastier After Its Upgrade to Buy
CAG has hung onto the bulk of its recent gains, and could rise to the $50 area, according to the charts and indicators.
Biogen Bulls Get a Lift From Quant Upgrade and Strengthening Charts
Breaking down an approach to the long side of this biotech stock.
Real Money's message boards are strictly for the open exchange of investment ideas among registered users. Any discussions or subjects off that topic or that do not promote this goal will be removed at the discretion of the site's moderators. Abusive, insensitive or threatening comments will not be tolerated and will be deleted. Thank you for your cooperation.
If you have questions, please contact us here.