Ramblings of a Portfolio Manager-
Well, earnings season officially kicked off last week and, as far as high profile reports go, we have a sample of one, well, maybe one full and two halves to work from. Research In Motion actually kicked it all off on the Thursday before by blowing away all analyst estimates…of course the Company had already set the bar really, really low two months earlier so we’ll give them half credit. Then there was Wells Fargo giving some pre-announcement good news on Thursday morning. But we really don’t know how their actual balance sheet and income statement look yet so let’s say they are a half credit as well. Alcoa was the real test, so said the TV talking heads anyhow, and they reported slightly better than expected top line numbers Tuesday night. Of course that stock went into earnings reporting season in the high $7 range having already made the trip up from around $5 at its low. Was the run up in anticipation of better than expected results or was the stock just going along with the market for a ride? At least for now, investors are starting to look across the chasm for improvement in the second half.
Perhaps, things might be improving going forward. The statisticians and consultant nerds would tell us that our sample size isn’t large enough from which to extrapolate with any significance. This week earnings, especially from the banks, will come fast and furious, which will put the look-ahead theory to the test.
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