If early reports are any indication, more U.S. companies may be missing the mark on profits this season than investors have become accustomed to.
It is still early in the game.
Results are in from just 10 percent of the Standard & Poor's 500 companies so far. But 50 percent have missed analysts' earnings estimates, compared with the long-term average of 63 percent for a full reporting period, according to Thomson Reuters data.
What's more, the earnings beat rate, as it is sometimes called, has been even higher in recent years, averaging 67 percent for the last four quarters, the data showed.
"For the first 52 on the clock, this is the worst start in terms of beats in about two years," said Nick Raich, chief executive officer of The Earnings Scout, an independent research firm specializing in earnings trends, in Cleveland, Ohio.
His research showed that 70 percent of the first 52 S&P 500 companies to report results have beaten earnings expectations since the first quarter of 2012.
An improving trend on the revenue side may more than buffer that weaker snapshot on earnings, however.
Sixty-seven percent of companies are exceeding revenue estimates so far, well above the average of 55 percent for a full season for the last four quarters, and above the 61 percent average since 2002, Thomson Reuters data showed.
But revenue growth for the quarter was expected to have risen a meager 0.4 percent at the start of the reporting season. That estimate is now up to 0.5 percent.
To many strategists, the data is too incomplete to give a good picture of the reporting period.
"It's really early. It represents too narrow of a slice," said Bruce Zaro, chief technical strategist at Delta Global Asset Management in Boston.
S&P 500 sectors with the worst earnings beat rates so far include industrials, consumer staples and technology, with Intel , General Mills and FedEx among some of the biggest names in those groups to miss profit forecasts.
"Estimates may just be too optimistic," said Greg Harrison, senior research analyst for Thomson Reuters.
For the fourth-quarter reporting period, negative outlooks from S&P 500 companies outnumbered positive ones at a higher ratio than any quarter since at least 1996, when Thomson Reuters began recording the data. There were 8.1 negative forecasts for every positive one.
Banks, which make up a good chunk of the early reporting companies, have been going against that trend. Even though expectations for the sector were high, they're still beating estimates at a rate above most sectors, at just under 60 percent, he said.
This week, 14 financial companies reported, and eight beat profit estimates, including Bank of America Corp
S&P 500 fourth-quarter profit growth now is projected at 7.1 percent, down from a forecast of 7.3 percent a week ago.