U.S. investors continue to face concerns about the impact of the stronger U.S. dollar and relatively low economic growth in Europe and Emerging markets. Not surprisingly, as the dollar has continued to strengthen over the past six months, consensus estimates of calendar year 2015 revenues and earnings for companies with the high Foreign Revenue exposure have been revised downward.
Source: S&P Capital IQ
In this report, we leverage S&P Capital IQ’s geographic segment-level data, coupled with S&P Capital IQ’s consensus estimate data, to determine the recent trend of revenue and earnings estimates for companies with different levels of foreign revenue exposure. Emerging from this analysis is what appears to be a direct link between the Foreign Revenue exposure and the degree of downward estimate revisions.