The Wall Street consensus badly underestimated the S&P 500's first quarter earnings this year: After predicting roughly zero growth in profits, the companies ended up reporting 6 percent growth. That's not such a big surprise; the analysts' estimates notoriously fall short of actual corporate earnings more often than not.
So when FactSet research service released an early estimate of second quarter corporate profits to reach 4 percent, that looks like very good news. That's based on reading corporate analysts' forecasts for the second quarter, which start reporting in early July. If the companies in the S&P 500 outperform as much this quarter as the last, we'll have an outstanding earnings season.
On the other hand, that number has been getting more pessimistic. When FactSet first projected second-quarter earnings growth, way back at the end of March, the forecast was a much more robust 7 percent.
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