Now for Some Top-Line Growth

The Pragmatic Capitalist has a good post on what to expect this earnings season. I agree with the overall thesis–the rally to date has been powered by profit margin expansion.
Lots of naysayers somehow think margin-expansion doesn’t count or it’s somehow illegitimate. It counts but the problem is it can only take you so far. I think we’ve reached that point or it’s very close to us. Now we need some revenue growth.
Another key fact is that earnings estimates have been very low. That’s not going to last either. As expectations rise, earnings beats will fade. I’m on the lookout for companies that provide solid guidance for the latter half of 2010.

Posted by on March 25th, 2010 at 2:35 pm

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