12 big companies to rack up $2B in losses

October 07 01:53 2015

Third-quarter corporate profit reports kick off this week. But for some investors it’s not a time to count profits, but to tally up losses. There are 12 companies in the Standard & Poor’s 500, including energy firm Anadarko Petroleum (APC), H&R Block (HRB) and Amazon (AMZN) that are expected to post adjusted losses that in total up to $2 billion.Amazon On A Hiring Spree

Investors are braced for a pretty horrible earnings season. Companies in the S&P 500 are expected to post 5% lower adjusted profit during the quarter, says S&P Capital IQ. If forecasts are accurate, the third quarter would be the first quarter of a profit decline since the third quarter of 2009. And there’s no question where the bulk of the pain is coming from: Energy. Plunging oil and energy prices are expected to push energy companies’ profits down 66% from the same period a year ago. Nine of the 12 companies expected to rack up $2 billion in losses during the quarter are energy firms. Excluding the energy sector’s profit hit, profits in the S&P would have been up 3%.

The hit from energy companies is difficult to overcome. Just one energy company, Anadarko, is expected to post an adjusted quarterly loss of $348.4 million during the quarter. That’s a larger quarterly loss than any other company in the S&P 500. The drop is breathtaking, as the company is expected to lose 69 cents a share during the quarter, down from a $1.16-a-share profit in the same quarter a year ago.

But it’s not just energy firms looking at red ink. Online retailer Amazon.com is expected to return to its money-losing ways in the third quarter. Analysts currently forecast the company to lose an adjusted 15 cents a share during the quarter. That’s much less than the 95 cents a share it lost in the same quarter a year ago, but still amounts to a net loss of nearly $69 million. Certainly, these losses are based on estimates and the actual results from the companies could wind up better. During the second quarter, Amazon reported an adjusted gain of 19 cents a share, even though analysts were calling for the company to lose 14 cents a share. That unexpected profit has helped made Amazon one of the best stocks this year — up more than 70%.

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