Home Business US quarterly reports come alive: what the market expects

US quarterly reports come alive: what the market expects

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The US corporate is resisting the blows of inflation and the surge in COVID infections well. As the quarterly season gets underway, for the last quarter of 2021, analysts estimate double-digit earnings growth.

In particular, according to the FactSet forecasts, reported by the Financial Times, the net profits of the S&P 500 companies are expected to increase by 22% on the previous year, after the + 40% marked in the third with energy, industrials, and materials driving growth

In particular, nine of the eleven sectors represented in the list are expected to show an increase in profitability compared to the same period of 2020. If these estimates materialize, it would be the fourth consecutive quarter of growth at a rate of more than 20%.

Earnings season comes at a difficult time for Wall Street equities, which started 2022 with volatile trading as investors examine the more aggressive stance in the market. Federal Reserve on the fight against inflation.

Binky Chadha, chief strategist of Deutsche Bank, He noted that, given the “extraordinary slump and then increased earnings” following the pandemic, looking at the change in fourth-quarter earnings versus the previous quarter would be more meaningful than annual figures. Earnings are expected to decline 4.6% on this basis, also taking into account seasonal factors.

A strong recovery in US corporate profits from the lows caused by the pandemic helped keep stock prices in check. Despite growing 23% annually, the S&P 500 is priced at 21 times the expected earnings over the next 12 months.

Quarterly USA: who starts the dance

The banks will kick off the season of accounts for the big names on Friday. The results will be communicated by JP Morgan Chase, Citigroup and Wells Fargo. Given that in general the last three months of 2021 should confirm the good trend recorded in the previous quarter, let’s see in detail the FacSet estimates:

  • JpMorgan Chase: Earnings per share of $ 3 on $ 29.85 billion in revenue
  • Wells Fargo: Earnings per share of $ 1.10 on $ 18.67 billion in revenue
  • Citigroup: Earnings per share of $ 1.55 on revenue of $ 16.92 billion
  • Bank of America: Earnings per share of 77 cents against revenues of $ 22.17 billion
  • Goldman Sachs: Earnings per share of $ 11.75 per share on revenue of $ 12 billion
  • Morgan Stanley: Earnings per share of $ 1.94 on revenue of $ 14.57 billion.

Next Wednesday will be the turn of Morgan Stanley and Bank of America while the next day it will be Netflix’s turn. The Big Tech quarterly reports are all concentrated in a few days: Apple will lift the veil on the accounts on January 27, the same day as Tesla while on February 2 it will be the turn of Meta (Facebook), Google and Amazon.

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