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Earnings Season Wrap up!

December 6, 2021

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The earnings season is mostly completed for companies on a traditional quarter end announcement cycle. We always wrap up our reporting around the 3rd or 4th week of the middle month of the quarter. This report is thru December 3, 2021.

Our portfolio had 65 companies announce earnings while we held the stock. On the EPS front, we had 89% of our companies either meet or beat vs Wall Street's EPS expectations. And we had 86% of our portfolio companies announce a beat or meet on Revenue expectations.
These are strong numbers that are a little better than the results for the S&P 500 but materially better than the beats results for the mid-cap and small cap universe. Across the companies that meet or beat on revenue expectations, the average beat was +4.9% which is quite strong.  The price response in our portfolio was very strong in November during the earnings announcement period which investors will see in their statements relative to the market benchmarks. 
On the forward guidance front, we continued the trend this quarter of a very strong ratio of positive guidance vs downward guidance. We had 39 companies provide upward guidance on either revenue or EPS. Meanwhile, only 5 portfolio companies provided downward guidance. That ratio of almost 8:1 is not our highest ratio ever - but is is close. More companies are providing guidance across the broader market so we are very happy that we continued our strong ratio here. A bias towards upward forward guidance is typically a very good way to set up the portfolio for out-performance. 
As usual, please reach out to us to schedule time to discuss these stocks and any other stocks for which you might want insight.

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