Wednesday, July 29, 2009

2007 Summer Earnings Reports

I have noticed that many companies are meeting or beating their EPS numbers, but missing their revenue numbers. This has me concerned about the health of the market in general. Although we are currently in a confirmed uptrend according the Investor's Business Daily, those top line revenue numbers have to increase in order to EPS numbers to stay high. The numbers seem to suggest that companies are trimming expenses to keep their earnings up which is a great thing, but you can only trim expenses so much and if the revenue isn't increasing eventually, the EPS numbers will start to suffer because you can only trim expenses so much.

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