WSH in the News Last Peak Week Of Q2 Earnings Season Is Here, Then Come The Retailers

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  • S&P 500 EPS growth for Q2 is set to come in at 6.7%, the lowest level since Q4 2020

  • Some highly anticipated names reported last week, with upbeat results from SBUX, ABNB, CAT

  • The LERI points to more companies showing signs of uncertainty regarding future growth potential

  • Potential surprises this week: TTWO, AKAM, SKT, H, SIX

After getting off to somewhat of a rough start, with banks and big tech, Q2 earnings began to hit their stride last week. The busiest week of the season did not disappoint, with many names across sectors like health care, technology and consumer discretionary handily beating expectations. Those positive surprises were initially enough to convince investors to take markets higher mid-week, but higher-than-expected jobless claims killed the rally on Thursday, with impressive nonfarm payrolls able to bring the markets back on Friday ending the week mostly flat.

Better-than-expected results lead to a 0.7-percentage-point increase in S&P 500 EPS YoY growth rate in the last week, which now sits at 6.7%. Thus far, 75% of companies are beating estimates, still lower than the five-year average of 77%. The percentage by which companies are surpassing estimates also remains low at 3.4% vs. a 5-year average of 8.8%. Q3 earnings expectations are trending lower as well, now down to 5.8% from 10.4% on June 30. (Data From FactSet)