No Revenue Growth Suggests Recession, According to Leading Financial Newsletter394 views 2012-08-14 04:16 Tags: companies 2001 produced reported Michael
In the article “Negative Revenue Growth for S&P 500 Companies Signals Recession,” Lombardi notes that the earnings outlook has been so poor that analysts have had to take down S&P 500 revenue estimates for the coming third quarter.
“For the second quarter, analysts were expecting revenue growth for the S&P 500 of eight percent year-over-year,” says Lombardi, “but, thus far, it has only produced growth of 1.2%,”
Lombardi notes that this is the slowest year-over-year growth since the recession began over four years ago.
“The negative earnings outlook by corporations in the S&P 500 has forced analysts to change their high single-digit revenue growth forecast for the third quarter to a negative 0.4%,” says Lombardi. “That’s negative revenue growth year-over-year.”
This means that, for the last three quarters, revenue growth in the S&P 500 has declined steadily and dramatically.
Historically, Lombardi says, when revenue growth has been negative year-over-year for S&P 500 corporations, it is usually followed by a recession.
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