Reporting Results

‘Tis the season when most public companies are reporting their recent quarter’s results. It is still early, but so far, over 80% of reports are better than expectations. In fact, we may be on the verge of having over $50 of quarterly earnings for the S&P 500 index companies. That will be on track for a $200 annual rate which works out to a little under 23 times earnings for the index.

This is not cheap, but the valuation is coming down as a result of these terrific results. All of this is in the face of a pandemic, supply chain issues because of the stop/start economy we have had, inflation, and many other uncertainties.

So, the terrific performance of the stock market this year does not look out of place after all. It will be interesting to see how companies do once more normal activity resumes. There will always be uncertainty and many concerning issues. However, business, in a free market system, is made up people who adjust and adapt. Hurrah for us. American business still works and is one of our greatest strengths. Stay steady my friends, the future is bright.

The Lonely Bull