Q4 2023 Earnings Estimates Begin to Fall

With a lot of the S&P 500 firms having reported third quarter earnings, analysts at the moment are coaching their sights on fourth quarter income and 2023 expectations.

Firms accounting for roughly 90% of the S&P 500’s market capitalization have reported up to now, with third quarter earnings beating analyst expectations by about 3%, a comparatively low determine. Now analysts are projecting that fourth quarter earnings will decline for the primary time in two years as rising rates of interest and slowing progress dampen the outlook for income.

Estimates have been falling for 2023 quarters as nicely. Goldman Sachs just lately minimize its 2023 S&P 500 earnings per share (EPS) progress forecast to zero, citing weakening revenue margins. Shares have seen EPS forecasts fall by 15% up to now six months, in response to FactSet. 

For the fourth quarter, analysts are forecasting a 0.4% fall in year-over-year earnings for S&P 500 firms, in response to IBES information. That compares with a 5.8% improve forecast on Oct. 1. 

The final time there was a quarterly decline in S&P 500 earnings was within the third quarter of 2020, when firms have been reeling from the onset of the COVID-19 pandemic.