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The disappointing second quarter from Netflix (NFLX) - Get Netflix Inc. Report , and brutal market response, should serve up one reminder to stock bulls. 

Watch the trends, specifically by how much companies are beating on earnings. With market valuations still lofty, investors have positioned for strong beats -- anything to contrary will be met with a swift negative reaction. 

Thus far, 10.8% of the S&P 500's undefined market cap has reported second quarter earnings. Earnings are beating by 4.5%, with 84% of companies surpassing bottom-line estimates according to data from Credit Suisse. The problem: companies beat on earnings by 4.8% in the first quarter. 

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Interestingly, the slowing degree in which profit estimates are beating comes as revenues are eclipsing estimates at a higher rate. Credit Suisse' data shows that the 10.8% of the S&P 500 that has reported has beaten revenue forecasts by 2.8%, better than the 1.1% in the first quarter. 

Not entirely surprising to see as inflationary forces in wages and oil outweigh gains in sales. If only the bulls were paying attention. 

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