Reconciling Earnings

(1) Lots of chatter about a profits recession. (2) The business and profits cycles are on a two-way street. (3) Profits reported to IRS still on uptrend. (4) Corporate cash flow at record high. (5) Two widely followed measures of EPS diverging sharply. (6) SP’s EPS much weaker than TR’s measure mostly due to Energy sector. (7) GAAP accountants are tough. (8) “Unusual” adjustments. (9) SP’s EPS seeks comparability across industries. (10) TR’s EPS measure aligned with analysts’ approach, and majority rule. (11) SP compares apples and oranges, unlike TR. (12) Apache as an example. (13) More power in de-energized S&P 500 forward revenues and earnings.