Expectations for the corporate earnings reporting season that kicks off in the week ahead have already increased by a record amount, but it still might not be enough.
“Analysts have been bumping Q2 estimates at a record clip, and they’re still too low. The market knows that,” Nicholas Colas, co-founder of DataTrek Research, wrote in a note. “This earnings season needs to be much, much better than expected.” Butters on Friday suggested that earnings will beat, writing “Based on the five-year average improvement in earnings growth during each earnings season due to companies reporting positive earnings surprises, it is likely the index will report earnings growth at or above 69% for the second quarter.”“We believe EPS will grow 75% led by robust earnings for Financials and Cyclicals,” Credit Suisse chief U.S. equity strategist Jonathan Golub wrote.
“We do not think the markets are worried about economic or earnings growth slowing from these very robust levels, at least at this point,” he concluded.
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