Are high-profile earnings misses a problem for the markets?

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Caterpillar missed Wall Street's estimates on earnings, even though the Street has been well aware of Caterpillar's problems, said Nick Raich of the Earnings Scout.

gave very poor revenue guidance for the fourth quarter, roughly 11% below consensus.

Raich also noted that most of these large misses are either company specific or sector specific. The issue of Boeing and the 737 Max jet are well known. FedEx had many company specific issues; its competitor UBS did not report the same type of problems. McDonald's reported U.S. same store sales below expectations, but there was significant traffic diversion around the "chicken sandwich" wars at competitors like Popeye's.

Raich notes that the Street has been well aware of Caterpillar's problems , reflected in the fact that the stock is up only 5% this year. "The stock reaction is telling you, bad news is already priced in," Stefanie Link with Nuveen said on our air today.

 

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