US companies leap over low profit hurdle in coronavirus-hit quarter

first_imgThe latest big boost to numbers came late last week, when results from Facebook and trillion-dollar market value companies Apple, Amazon.com and Google parent Alphabet surpassed forecasts.In many cases, estimates had been lowered so much ahead of earnings season that they were easier to beat, strategists said. Still, the results bolster the case for investors betting that the impact of coronavirus-led lockdowns and layoffs on companies’ bottom lines may not be quite as dire as previously believed.“What it’s saying is there are pockets of absolute strength in corporate America,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey.Tech results in particular suggest “there is spending going on globally,” she said. A record high percentage of United States companies are beating analysts’ forecasts this earnings season, giving investors a glimmer of hope in what is still expected to be the slowest profit period since the financial crisis.More than halfway through second-quarter earnings, 82.1 percent of companies reporting have surpassed profit expectations, which would be the highest in the history of Refinitiv IBES data going back to 1994.What’s more, the size of the beats is well above what is typical. S&P 500 companies have beaten earnings expectations by a whopping 21.7 percent, also set to be the highest on record since 1994, based on Refinitiv’s data as of Friday. The S&P 500 is up nearly 4 percent since results began in mid-July, putting it 3.4 percent from its February record closing high.To be sure, the pace of the market’s rebound off the March lows has slowed in recent weeks, with earnings coming in as the United States sees a resurgence in virus cases in many areas and economic numbers remain bleak.Second-quarter S&P 500 earnings – expected to have dropped 33.8 percent from a year ago – are still set to be the low point for earnings this year and the biggest quarterly decline since the financial crisis.Data on Thursday showed jobless claims rose last week, while the economy took its biggest hit on record in the second quarter.Strategists at BofA Global Research wrote in a recent note that while margins are “tracking a hair above expectations,” they are still expected to collapse and comments from companies suggest more job cuts ahead.Still, some companies have managed better-than-expected results for the second quarter.Investors have been particularly keen to hear from technology companies, the most heavily weighted sector in S&P 500 earnings.With results in so far from 36 of the 71 tech companies in the S&P 500, second-quarter earnings for the S&P 500 tech sector now are seen growing 1.4 percent from a year ago versus an 8 percent decline estimated on July 1, Refinitiv’s data shows.The S&P’s healthcare index has also seen big improvements since July 1, thanks to strong results from UnitedHealth Group, drugmakers like Pfizer and others. Analysts now expect healthcare earnings to have increased 1.1 percent compared with a 15.1 percent decline forecast at the start of July, according to Refinitiv.“The second quarter of 2020 was a quarter with more uncertainty in it than I have ever seen in my life. Managements for the most part suspended guidance, so had the world kind of flying blind as to what the second quarter would bring,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.And, “it’s brought results that are generally better than the worst imaginable. … Things are a little bit more positive than many people thought.”Topics :last_img read more

Purple & Bold: Lakers have found their discomfort zone

first_img AD Quality Auto 360p 720p 1080p Top articles1/5READ MOREUCLA alum Kenny Clark signs four-year contract extension with PackersAnd yes, playing while sick impressed them, too.“He’s had reason to sit out, but he’s not sitting out of any games,” Green said. “Now he wants to fight through everything. And he’s letting not just us know that he has our back, but he’s letting the league know that he’s not sitting out for any reason.”Being under the weather is a temporary challenge, but it clicks with something the Lakers have talked about a lot this year: being comfortable with being uncomfortable. That can be an empty-calorie cliché in some contexts, but the Lakers have imbued that with real meaning with what Coach Frank Vogel calls their “growth mentality.” The players in the locker room have goals of expanding their games in particularly helpful ways.An example: Davis has made no secret that he prefers power forward over center. The Lakers made concessions and roster decisions to enable that for him. But Davis has had to do his part by guarding opposing power forwards, many of whom are smaller than him.In the modern NBA, this means Davis is often guarding ball-handlers rather than sticking near the rim and swatting at anyone who approaches. He pointed out that many teams pin down fours near the corner, and then give them the ball. Davis is used to guarding screeners rather than fighting his way through screens: It’s a completely different skill. Editor’s note: This is the Dec. 4 edition of the Purple & Bold newsletter. To receive the newsletter in your inbox, sign up here.DENVER — Here’s a Tuesday night twist on the Kawhi Leonard line: Sick man gets shade.As a red-nosed Anthony Davis swaddled himself in a towel in one corner of Pepsi Center’s visiting locker room, teammates playfully coddled him. Danny Green suggested he drink a ginger ale for his flu-like symptoms, while LeBron James called him “sick man.” Kyle Kuzma and Rajon Rondo noted they were both sick – implying that the media asking about Davis’ halftime IV drip might be a little too focused on the Lakers’ big man.But beyond all that was a genuine admiration from the Lakers for a night when Davis, who stonewalled the Denver Nuggets at the rim for the final three minutes of a 105-96 win on the road. A player whose stated goal since the beginning of the season has been winning NBA Defensive Player of the Year managed to make the crucial plays when it mattered. Also, if the Lakers switch (which they often do in crunch time), that means Davis could find himself, at 6-foot-10, trying to keep his feet in front of an opposing guard. He did this twice against Jamal Murray on Tuesday night in Denver. Neither is something he feels particularly great at, but he knows it’s his responsibility to improve in both areas.“So those two things are pretty different for me and I’m constantly just trying to get better at it,” he said. “But everything else, I take pride in what I can do – the other things – just as well as anybody in the NBA.”Remember: This is a veteran team. There are many players who have very well-defined roles in accomplished careers. But up and down the roster, you can see molds being broken and players redefining themselves.This is Dwight Howard, becoming an energy defender and roll man off the bench. This is Rajon Rondo, starting the season shooting 48 percent from 3-point range. This is LeBron James, leading the league in assists and leaving room on the stage for Davis as a co-star.This was something James alluded to as well, shouting out both Davis and Howard postgame for how they’ve worked on embracing the roles they’ve been given.“(A.D.) having to switch off on smalls, that’s being comfortable with being uncomfortable, and having growth mindset to be able to go out and do things that sometimes you wasn’t accustomed to doing in the past, because it’s for the better of the team or for the better of you individually,” he said. “We’re all trying to figure that out.”Many teams spout these kinds of sayings, but words only mean as much as the truth behind them. And so far, the Lakers have made growth a foundation of their 18-3 start. And if they keep it up, the rest of the league might need to be worried about what potential they still have.TOP QUOTABLEBless Danny Green. He’s nothing if not honest.Against the Nuggets, he wasn’t particularly on target, going just 2 for 12 overall and 1 for 7 from behind the arc. He admitted as much, saying that the bench (which had 42 points) had bailed out the non-LeBron-A.D. starters (who had 13 points).Lakers sideline reporter Mike Trudell pointed out that after his Lakers debut, when he scored 28 points, Green had said he wasn’t as concerned about whether his shots were falling as much as he was about getting good shots in rhythm. Green acknowledged that’s how he felt in the first game of the season, but now his priorities have shifted a little bit.“I do care. I would like to make shots. I did lie. I’m sorry I lied,” he said, with a bashful smile. “I would like to make shots. … Early in the season I don’t care as much, I just care about the process and how we look, what kind of shots we’re getting. If we’re getting good shots, good rhythm shots on offense, if they don’t get in, then I don’t care. Later they’ll be going in. That was early in the season. Now, we’re probably a third of the way through. I care a little bit more. A lot more. I would like to make some shots.”For the record, Green’s hitting 38 percent of his 3-point attempts this year. But as discussed above, we’ve all got room to improve.— Kyle GoonEditor’s note: Thanks for reading the Purple & Bold newsletter. To receive the newsletter in your inbox, sign up here.In Click-ness and in HealthMile-high manifest – Lakers show their aerial dominance against the No. 2 team in the West.“Who’s surprised?” – Not Denver coach Mike Malone, who has seen LeBron do this before.The slope gets steeper – How the Lakers look at a tough December schedule.The long-awaited Lakers – Mark Heisler gives perspective about the long drought for the NBA’s signature franchise.Dented by Dallas – Ending a 10-game winning streak, there were lessons to be learned Sunday.Injury updates – Avery Bradley is missing this road trip.Waxing the Wizards – Ouch.Mo’ Moe in Washington – The former Lakers pick has found his role after being traded over the summer.Bad habits could bite – Mirjam Swanson tried to warn y’all.center_img Newsroom GuidelinesNews TipsContact UsReport an Errorlast_img read more