DEFINITION of 'Earnings Momentum'
When corporate earnings per share (EPS) growth is accelerating or decelerating from the prior fiscal quarter or fiscal year. Earnings momentum typically coincides with accelerating revenues and/or expanding margins caused by increased sales, cost improvements or overall market expansion.
INVESTOPEDIA EXPLAINS 'Earnings Momentum'
Because of the quarterly reporting system required by the SEC, most earnings momentum analysis will rely on quarterly data, as the smaller reporting period can highlight momentum more clearly if it exists.
Investors are always on the lookout for positive earnings momentum, as it will usually propel a stock price higher over time, depending on how anticipated the momentum is. Earnings multiples (as in the P/E ratio) are the foundation for most stock prices, and if earnings are increasing at a faster clip than expected, then current multiples can quickly appear too low. As a result, investors will bid up the stock to reach a new level of equilibrium.
On the other hand, if earnings momentum falls away, the price of the underlying stock may drop despite the fact that earnings as a whole are still increasing.

Earnings Per Share  EPS
The portion of a company's profit allocated to each outstanding ... 
Consensus Estimate
A figure based on the combined estimates of the analysts covering ... 
Net Income  NI
1. A company's total earnings (or profit). Net income is calculated ... 
Revenue
The amount of money that a company actually receives during a ... 
Whisper Number
1. Traditionally, the unofficial and unpublished earnings per ... 
Sharpe Ratio
A ratio developed by Nobel laureate William F. Sharpe to measure ...

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