FYI: With more than 90 per cent of S&P 500 companies having reported their financial results for the third quarter, earnings season is finally drawing to a close.
Sell-side analysts have been caught a little flat-footed as companies have reported far better results than expected. According to Bank of America's Savita Subramanian, earnings per share have beat analysts' estimates from the start of October by 5 per cent, led by outperformance in the energy, financials and health care sectors. Analysts underestimated this metric by a similar degree in the first and second quarters. On the sales front, the top line has come in roughly 8.5 per cent more year-over-year than analysts anticipated.
These results beg the question of just how much weight we should give analysts' earnings forecasts. It turns out, not much, especially in the long run
Regards,
Ted
https://ftalphaville.ft.com/2018/11/13/1542091438000/How-accurate-are-sell-side-analysts-/
