S&P Core Earnings


DEFINITION of 'S&P Core Earnings'

The Standard and Poor's revised version of the measurement of core earnings, which excludes any gains related to pension activities, net revenues from the sale of assets, impairment of goodwill charges, prior-year charge and provision reversals, and settlements related to litigation or insurance claims. Expenses related to employee stock option grants, pensions, restructuring of present operations or any merger and acquisition costs, R&D purchases, write-downs of depreciable or amortizable operating assets, and unrealized gains/losses from hedging activities are all included in the core earnings.

BREAKING DOWN 'S&P Core Earnings'

This is a new standard created by S&P with the assistance from the financial and investment community. These core earnings provide for transparency and consistency, as well as a more stringent definition of a company's core earnings, clearly setting out exactly what can and cannot be considered earnings and expenses.

  1. Acquisition

    A corporate action in which a company buys most, if not all, ...
  2. Goodwill

    An account that can be found in the assets portion of a company's ...
  3. Income

    Money that an individual or business receives in exchange for ...
  4. Earnings

    The amount of profit that a company produces during a specific ...
  5. Write-Down

    Reducing the book value of an asset because it is overvalued ...
  6. Core Earnings

    The revenue derived from a company's main or principal business, ...
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  2. What are working capital costs?

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    The income statement, also known as the profit and loss (P&L) statement, is the financial statement that depicts the ... Read Full Answer >>
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