Last week I posted my first tech earnings scorecard for this earnings season. Last night's results are a continuation of the theme.
This week I added a couple of new measures. I now track whether the stock beat First Call estimates by 20% or more and whether it showed 20% or more growth in earnings year-over-year.
There have been so many stocks reporting that I have opted not to display a table of results as it would be just too long. Instead, I'll present a summary of the numbers I have assembled thus far during this earnings season. These numbers include the stocks that reported over the course of the last three weeks including tonight, Monday.
- We have tracked 167 tech stocks so far
- 146 stocks beat First Call estimates which amounts to 87%
- 44 of those stocks beat earnings estimates by 20% or more
- 100 stocks showed at least some year-over-year earnings growth whether they beat estimates or not
- 41 have shown year-over-year growth in earnings of 20% or more
- 98 stocks have shown year-over-year revenue growth. That amounts to about 58%
- 35 have shown revenue growth of 20% or more
- 88 have provided upside guidance which amounts to about 52%.
- 27 others provided mixed or in-line guidance.
- Only 3 stocks offered downside guidance
Given that we are still in the early stages of recovery from the Big Recession, these results look pretty darn good. Yet tech was the worst performing sector in the last two weeks of January.
I still contend that tech deserves more respect, especially in light of the relatively good guidance being provided and the fact that topline growth is being registered in more than half of those stocks reporting. This means that for many of these companies, earnings are not merely the result of cost cutting.
Keep an eye on this sector. Investors should catch on soon and tech could resume their leadership role.