Fourth-quarter earnings season kicks into full gear over the coming weeks, and though profits are expected to fall slightly—capping off 2019 as a year of lackluster earnings—Wall Street is hopeful that earnings will rebound in 2020, helping justify high stock prices and boost further economic growth.
As companies start reporting profits for the final quarter of 2019, earnings are expected to go down by 0.6%—following the trend of lackluster growth seen in the prior three quarters. Given that stocks on the whole are expensive right now, companies will need to show good earnings growth this year in order to justify high price valuations as major indexes hit new record highs as recently as last week.
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