First, we will dissect the blue box at the top. 

As it says, this is the first quarter’s (1Q25), street consensus for earnings-per-share for the S&P 500, which is a key input for calculating price targets. We track how EPS moves by comparing the estimates at the end of the previous quarter, noted in the first line, and then seeing where the estimates are in the next quarter. This is in the second line. 

The percentage change line calculates whether earnings are coming in better than what analysts estimated at the end of the quarter versus currently. As we get along in the earnings season, a myriad of different factors like Federal Reserve policy, trade policy, and idiosyncratic news can influence analysts’ earnings estimates. As such, the third line is helpful in determining if analysts are optimistic or nervous about the earnings season depending on the news cycle.  

Let’s go to the table now.

The first column heading shows the number of companies reported. This number goes up as we progress along the earnings season, with the pace of companies reporting earnings slowest at the start, thickest in the middle, and tapering off at the end. The S&P 500 has 500 companies, so all those companies have to release earnings before the season can be declared concluded. (And of course, publicly traded companies are required by the SEC to release quarterly earnings.) 

The second column divides the number of companies by the total, to get to 99% to again tally up how far along we are in the earnings season.

The third column is titled percentage of companies beating. Wall Street analysts come up with their own estimates for a company’s EPS, which can be found on FactSet. Those estimates are then compiled as a consensus against which a company’s actual results are then compared. This column and the fourth column shows the percentage of companies that are clearing or missing that consensus bar, respectively.

But more important than those two metrics is the surprise percentage column. It calculates by  just how much a company is beating earnings, relative to analysts’ expectations. Obviously, for anyone not holding a short position or somehow betting against the company, higher is better.

The relative return is straightforward, calculating the index’s gain since the end of the previous quarter. 

The rows divide up this information by themes like cyclicals, near-cyclicals, and defensives, and then by S&P 500’s 11 sectors. 

The second chart details the most important metric: earnings growth. 

The actual column tracks companies that have actually had earnings and reports a company’s earnings growth from a year ago. The estimates column does the same thing but takes into account analysts’ estimates for the companies that haven’t reported earnings yet, so this is all pure consensus. Blend, the third column, combines the actuals and estimates.

Although consensus analyst expectations can provide a useful glimpse into the Street’s views on a company, investors as a whole sometimes price in their own beat or loss expectations ahead of the announcement. Thus, the most counterintuitive thing about earnings season is that even if a company posted losses in the most recent quarter, its shares can rise if the loss was less than expected. Similarly, even if it posted a huge beat, its shares can decline if the beat wasn’t as big as expected. 

You can apply these same principles to the sales charts and tables. 

Earnings releases are only half the picture. Click through to the next part to find out what’s even more important.