Earnings Expectations for First Quarter are Modest (AA, GOOG, JPM, WFC)

Alcoa Inc. (NYSE: AA) kicks off the new earnings season after the markets close today, and according to S&P Capital IQ consensus estimates, it looks like earnings are going to be off to a wobbly start. Capital IQ expects an EPS loss of -$0.03/share compared with EPS of $0.28 in the first quarter of 2011.

Other major reports due this week include Google Inc. (NASDAQ: GOOG), JPMorgan Chase & Co. (NYSE: JPM), and Wells Fargo and Co. (NYSE: WFC). Earnings estimates from Capital IQ estimate EPS of $9.62 from Google, compared with $8.08 a year ago (up 19%); EPS of $1.16 for JPMorgan, down from $1.28 a year ago (down 9.1%); and EPS of $0.73 from Wells Fargo, up from $0.67 a year ago (up 9.3%).

So far this year, 81% of 27 S&P 500 companies that have reported first quarter earnings have beaten expectations. The surprise has been 11.3% to the upside so far, but overall the calendar quarter growth rate projected by Capital IQ is just 1.02%. That’s a far cry from the 11.2% earnings growth posted in the fourth quarter by the S&P 500.

We noted the tempered expectations for first quarter earnings in more detail yesterday. The S&P Capital IQ numbers reiterate the modest outlook for the new earnings season.

Paul Ausick