Earnings growth rate for the Consumer Discretionary sector boosted by retailers

The S&P 500's Consumer Discretionary sector was a focus sector this past week, as a number of retailers reported earnings results. Among retail sub-industries in the sector, the General Merchandise Stores and Home Improvement Retail sub-industries saw the largest improvement in earnings growth during this time.

Despite a number of high profile companies reporting EPS below expectations (including Wal-Mart Stores and Sears Holdings) in recent weeks, most companies have reported EPS above the analyst expectations. Of the 479 companies that have reported earnings to date, 73% have reported earnings above expectations, which is consistent with the 74% average recorded over the past four quarters.

Due to these results, the blended earnings growth rate now stands at 15.7%, up from last week’s growth rate of 15.6%. Better-than-expected earnings from Dell and Target accounted for most of the increase in the growth rate during the week.

Overall, the current blended earnings growth rate of 15.7% is also well above expectations of 12.6% growth on September 30. Better-than-expected earnings from companies in the Energy, Health Care, Information Technology, and Industrials sectors have driven this increase in earnings growth since the end of the quarter. All ten sectors are reporting earnings growth for Q3 2011, with five of the ten sectors reporting double-digit growth.

The “peak weeks” of the Q3 2011 earnings season are now finished. The remaining 4% of companies in the index that have not reported earnings for Q3 2011 to date will do so over the next four weeks. During the upcoming week, eight companies in the S&P 500 and final DJIA component (Hewlett-Packard) are scheduled to report earnings.

Read more about earnings season in this week's edition of FactSet Earnings Insight.

All of the data used to compile FactSet Earnings Insight is available in the FactSet workstation.