S&P Core Earnings

AAA

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.

INVESTOPEDIA EXPLAINS '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.

RELATED TERMS
  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. Core Earnings

    The revenue derived from a company's main or principal business, ...
  5. Expense

    1. The economic costs that a business incurs through its operations ...
  6. Merger

    The combining of two or more companies, generally by offering ...
Related Articles
  1. Markets

    The 5 Types Of Earnings Per Share

    A look at the five varieties of EPS and what each represents can help an investor determine whether a company is a good value, or not.
  2. Options & Futures

    Core Earnings Strip Away "Creative" Accounting

    This metric is an attempt to counteract creative accounting, but it poses its own set of challenges.
  3. Fundamental Analysis

    What is the difference between operating income and net income?

    Understand the difference between operating income and net income, including the calculations and interpretations of each when reading a balance sheet.
  4. Fundamental Analysis

    What is the difference between operating income and EBITDA?

    Read about the major differences between earnings before interest, taxes, depreciation and amortization (EBITDA) and operating income in a company's financial health.
  5. Fundamental Analysis

    What is the difference between operating income and gross profit?

    Learn more about the difference between operating income and gross profit, two accounting figures that appear on a company's income statement.
  6. Investing Basics

    Is operating profit the same as net income?

    Understand the difference between operating profit and net income, including how each type relates to the other and how both are derived from company revenue.
  7. Fundamental Analysis

    What is the difference between gross margin and contribution margin?

    Understand the difference between the gross margin and the contribution margin, including how they differ in calculation and how they reflect profitability.
  8. Investing Basics

    What's an example of a P&L statement?

    Understand the basic components of a P&L statement, and how these components are presented in compiling this fundamental financial statement.
  9. Investing Basics

    How do you read a P&L statement?

    Understand the basics of reading a profit and loss statement, including key concepts such as revenue, net operating income, gross profit and net profit.
  10. Investing Basics

    How do you find a company's P&L statement?

    Learn how to find a company's profit and loss statement, along with the other financial statements that companies regularly publish.

You May Also Like

Hot Definitions
  1. Christmas Tree

    An options trading strategy that is generally achieved by purchasing one call option and selling two other call options at ...
  2. Christmas Club

    A short-term savings account that usually pays out the full account balance to its account holders once each year, right ...
  3. Boston Snow Indicator

    A market theory that states that a white Christmas in Boston will result in rising stock prices for the following year. For ...
  4. Christmas Island Dollar

    The former currency of Christmas Island, an Australian island in the Indian Ocean that was discovered on December 25, 1643. ...
  5. Santa Claus Rally

    A surge in the price of stocks that often occurs in the week between Christmas and New Year's Day. There are numerous explanations ...
  6. Commodity

    1. A basic good used in commerce that is interchangeable with other commodities of the same type. Commodities are most often ...
Trading Center