TME Weekend: Beat rates 2nd worst in 7 years

Beat rates 2nd worst since 2016

With only 10% of the SPX having reported, results are pretty poor. So far, the beat rate is an anemic 65.4%. That’s the 2nd worst since 2016, with the lowest coinciding with 1Q20 lockdowns.

Source: Jefferies

Facing a high bar

JPM's Dubravko: "...we see stocks facing a high bar — during this earnings season, anything short of strong corporate guidance re-affirming current high growth expectations is likely to be penalized."

...or is it a low bar...?

Q4'23 estimates have been cut notably in the last couple of months, especially in the US.

Source: Barclays

Longer term: Nice EPS MoMo coming up

The quarterly path of S&P 500 EPS year/year growth looking good.

Source: Goldman

Just catching up

Price action has narrowed the gap with earnings after the year-end rally.

Source: Barclays

Big Tech earnings revisions

Let end with the only thing that matters; Big Tech earnings. 5 out of 7 Big Tech names have seen upward earnings estimate revisions for the last quarter and this year over the past 3 months. As a group, they’ve seen average upward earnings revisions of 6.7% and 4.9% for last quarter and 2024 respectively, considerably better than the S&P (-7.1%, -1.3%). 

Source: Data Trek

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