This is a new table that lists all of the stocks in the Group and SOX that reported their 4th quarter and 2008 results that ended at the end of December 08. In total, there are 18 of these stocks.
By using these 18 stocks in a table, it is easier to compare "apples to apples" with current year and next year earnings. Current year earnings correspond to CY 09 and next year earnings correspond to CY 10. There are several items of interest in these tables - here are a few of them.
1. Look at the bottom part of the table first. Notice how the yearly actuals at the bottom line have trended down from 06 and go deep in the "red" in 09 with some recovery in 10. Even by the end of 2010, earnings are estimated to be substantially less than the actuals of 08, and about 1/3rd of actuals achieved in 06. In other words, even by 2010 estimated earnings are very weak.
2. Going to the upper right of the table, we can view what I call the "saucer effect". This part of the table shows the March quarter estimates, the June quarter estimates, and the last half of the year estimates with the total estimates for CY09 that match the estimates given for 09 in the bottom part of the table. Note how the Mar estimates are -3.98, June estimates are -2.75, and the last half of the year are -0.85 for a total of -7.58. Then of course continuing on into 2010, the estimate goes to 5.94. As noted, 5.94 is not much compared to past year actuals, but it is far better than what is estimated for 09. Looking at the upper right side of the table, the Dec actuals were -1.63. So from the Dec actuals of -1.63, the estimate goes to -3.98 for Mar, -2.75 for June, -0.85 for 2H09, to 5.94 for 2010. At the moment, this is the consensus outlook from the analysts, and pretty much what the market is looking at. This is why the SOX and SMH have been relatively strong over the past many weeks since the bottom of 11/21, the "market" sees the better performance estimates for 2H09 and on into 2010 and wants to "get on board".
It is important to note that the table above is a "snapshot" in time as far as the estimates are concerned. These estimates will change in the days, weeks, and months going forward as new information becomes known. The estimates can go either up or down, effectively changing the current timeline of the recovery, either shorter of longer. Currently, I plan to keep track of the estimate information and update it at periodic intervals for posting. Hopefully this will provide a "clue" as to what the "market" is thinking as we progress forward about the length of the recovery cycle. |
