Last week's rebound has not erased the possibility of a recession. Corporate margins for the upcoming year continue to forecast uneasy times for leading European companies. In the past few weeks, deterioration of 2012 market forecasts has been constant. But telecom and gas companies are enduring profit cuts more than most.
At a time when balance sheets deteriorate due to pressure from unstable markets, Fact Set's market consensus view is that telecom business is going to be hurt the least. Similarly, in the past two months experts have cut next year's net margin predictions for the top 15 companies in the sector by only 0.5%. This cuts are slight, in part, because of corporate improvements that experts have been forecasting since July, most of all for the German company Deutsche Telekom. But they are not the only strong company.
Gas companies are also successfully escaping big earnings prediction slashes. Even though Brent crude lost more than 10% since the beginning of August, the major European petroleum companies have seen 2012 profit predictions trimmed by just 1.8%. Also, the health and public services sectors expect earnings predictions to drop no more than 2%.
The best survive, the rest hang on
Not everyone can win big in times like these, or even last for that matter. Deutsche Telekom earns the highest respect among telecoms, given that experts have raised their 2012 predicted earnings by 13% during the past two months. Expert forecasts note that the company?s invoices will remain similar to 2011 (around 45.6 billion euros), and the experts hope that the German company is capable of boosting profits by more than 10% in 2012 (increase of 2.9 billion euros). Certainly, this is a value worth keeping in mind.
