With earnings season raging this week, most investors have one thing on their minds: growth. But for investors paying attention, earnings season also rats out companies quietly and consistently shrinking.
If analysts' 2014 revenue forecasts are accurate, 11 companies in the , including drug maker Bristol-Myers Squibb, defense contractor Northrop Grumman, retailers Staples and Avon and computer company Hewlett-Packard, are expected to be the fastest shrinking companies this decade so far, based on a USA TODAY analysis of data from S&P Capital IQ.
More from USA Today:
- BofA math error halts dividend increase
- Blame it on the rain? 60% of companies did
- How to turn your kid into next Buffett?
These are the companies that have been steadily declining in size either by seeing demand for their products dry up, pricing power evaporate or by taking other corporate moves that reduce their size. Only non-financial companies that posted revenue declines in 2012, 2013 and expected to shrink again in 2014 were included.
Investors have been willing to give companies just having a negative 2014 a pass. But longer-term, investors' patience with companies that are unable to grow for such a long period of time has worn thin. Shares of the 11 shrinking companies are down nearly 3 percent this year, well below the 0.9 percent gain by the S&P 500.
It's another reminder that while overhyped and overheated stocks can be hazardous to your portfolio, companies that aren't able to keep growing and remain relevant are also often tough places for investors to be long term.
S&P 500 companies that with largest revenue declines this decade, that posted revenue declines in 2012, 2013 and expected to fall again in 2014.
Source: S&P Capital IQ, USA TODAY research
—By Matt Krantz, USA Today