Q3 2024 Earnings Season Sees S&P 500 Facing Analyst Pessimism Despite Corporate Optimism
Wall Street’s latest prediction? A high chance of CEOs and analysts not seeing eye-to-eye. Banks started strong after JPMorgan Chase and Wells Fargo set a positive tone for the earnings season by reporting better-than-expected results. Despite this optimism, the Citigroup index tracking earnings revisions fell to its lowest since Dec. 2022, signaling analysts’ caution. While CEOs are projecting robust growth, Wall Street number-crunchers are tapping the brakes on their expectations.
- According to Bloomberg Intelligence, company projections point to a 16% year-over-year earnings growth, but analysts have lowered their expectations for S&P 500 third-quarter earnings to just 4.2%.
- Profit growth for the Magnificent Seven stocks is expected to be 18%, a slowdown from the 36% YoY increase seen in the previous quarter.
The plot thickens: With the S&P 500 enjoying its best start to a year since 1997 — up 23% — Bloomberg suggests that investors might be anticipating another round of better-than-expected results, similar to the strong performance in Q1. This week’s earnings are bustling with activity, starting today with major firms like UnitedHealth, Johnson & Johnson, and Bank of America reporting. The excitement continues through Friday when Procter & Gamble and American Express wrap up the week. These earnings will shed light on whether the economic high can keep soaring or if investors are due for a reality check.
