Street Earnings Overstated For 70% Of S&P 500 In 2Q23

Street Earnings, as reflected in Zacks Earnings, are marketed as being adjusted to remove unusual income and charges. My Core Earnings show Street Earnings fail to account for a material amount of unusual income and charges, which distorts investors’ view of profitability across the S&P 500. This report shows:

• the prevalence and magnitude of overstated Street Earnings in the S&P 500,
• why Street Earnings (and GAAP earnings) are flawed and not adjusted as promised, and
• five S&P 500 companies with overstated Street Earnings and an unattractive Stock Rating.

208 S&P 500 Companies Overstate EPS by More than 10%

For 357 companies in the S&P 500, or 71%, Street Earnings are higher than Core Earnings for the trailing-twelve-months (TTM) ended 2Q23. In the TTM ended 1Q23, 347 companies overstated their earnings. My Core Earnings research is based on the latest audited financial data, which is the calendar 2Q23 10-Q in most cases. Price data as of 8/15/23.