NEW YORK, April 23 — Investors are hoping a flood of US quarterly reports next week, including those from megacap growth titans, will confirm a solid profit outlook for corporate America and bolster the case for stocks after a rocky start to the year.
With monetary policy weighing on stocks, bullish investors are counting on a solid corporate outlook to support markets, ratcheting up pressure on companies to report solid bottom-line results and forecasts. S&P 500 companies are estimated to increase earnings by 9 per cent this year, according to Refinitiv IBES.
Though stocks have declined year-to-date, the S&P 500 still has been trading at about 19 times forward earnings estimates, above its long-term average of 15.5 times. Earnings expectations for these companies are subdued for the quarter ended in March. Microsoft is expected to have increased adjusted earnings per share by 12 per cent from the year-earlier period, Apple by 2 per cent, while Alphabet is seen posting a 0.7 per cent dip and Amazon reporting a 49 per cent drop, according to Refinitiv data. S&P 500 companies overall are expected to increase quarterly earnings by 7.3 per cent.