Apple’s (Nasdaq: AAPL) disappointing earnings yesterday were the latest in what has become a disturbing trend this earnings season.
While the world’s largest company didn’t technically fall short of earnings estimates, its iPhone sales underwhelmed. The 51 million iPhones Apple sold over the holidays, while a record, were still 4 million shy of consensus analyst expectations. That was enough to send Apple shares plummeting after hours. The stock opened Tuesday trading down more than 8%, and is threatening to dip below $500 a share for the first time since October.
AAPL isn’t the only stock that has suffered after reporting Q4 earnings over the last month.
According to FactSet, only 68% of S&P 500 companies have beaten earnings expectations so far this earnings season. That’s below the one-year average of 71% and even further below the four-year average of 73%.
Only about a quarter of the S&P companies have reported earnings thus far, so it’s still too early to make any sweeping judgments. But holiday earnings aren’t exactly off to a booming start. And right now, it’s hurting the stock market.
Since Alcoa (NYSE: AA) reported lackluster earnings on Jan. 9, stocks have fallen more than 3%. That’s the biggest drop-off on Wall Street since late September.
Of course, there have been a number of mini pullbacks over the past year, and each time stocks have bounced back and risen higher than ever before. Whether that happens this time may depend on if earnings can improve over the next few weeks.
This week alone could be rather revealing. AAPL was merely the first of several blue-chip stocks set to report Q4 results. Four of the 10 richest U.S. companies by market cap report earnings this week, including the three largest companies.
Here’s what’s on tap the rest of the week:
Tuesday (after hours)
- AT&T (NYSE: T)
- Yahoo! (Nasdaq: YHOO)
- Facebook (Nasdaq: FB)
- Amazon (Nasdaq: AMZN)
- Chipotle (NYSE: CMG)
- Conoco Phillips (NYSE: COP)
- Exxon (NYSE: XOM)
- Google (Nasdaq: GOOG)
- United Parcel Service (NYSE: UPS)
- Visa (NYSE: V)
- Chevron (NYSE: CVX)
- MasterCard (NYSE: MA)
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