CHART OF THE DAY: Profitability Was Already Deteriorating

04/01/20 07:36AM EDT

Below is a chart and brief excerpt from today's Early Look written by Hedgeye CEO Keith McCullough.

In today’s Chart of The Day I’m showing you a slide (76 in our Q2 Macro deck) I’ve been chatting with clients about for the last week:

A) PRE VIRUS, profitability was already deteriorating (like it always does at this stage of The Cycle)
B) Alongside Global #Quad4 Slowing since the beginning of 2018, US Labor Costs Rising was classic late cycle

That’s why:

C) PRE VIRUS, 37% of the companies in the Russell 2000 had NEGATIVE pre-tax income … and
D) PRE VIRUS, 27% of companies with market caps > $10B had NEGATIVE year-over-year EPS growth

“No one” (ex the legally blind) could have seen The Cycle coming, eh?

CHART OF THE DAY: Profitability Was Already Deteriorating  - 76

© 2024 Hedgeye Risk Management, LLC. The information contained herein is the property of Hedgeye, which reserves all rights thereto. Redistribution of any part of this information is prohibited without the express written consent of Hedgeye. Hedgeye is not responsible for any errors in or omissions to this information, or for any consequences that may result from the use of this information.