Morning Notes — Q3 Earnings Season

The consensus 2021 S&P 500 EPS estimate has quietly climbed from ~$165 to ~$168 over the last three weeks. Without any positive impact from fiscal stimulus or vaccines, the number seems destined to surpass $170 by the end of the CQ3 earnings season.   Analysts typically lower company EPS estimates during most quarters by a 15-year average of -5.2%.  It’s very rare for analyst to raise EPS estimates.  Over the last 15 years, there’s only been 3 quarters when this has happened; twice in 2018 and once in 2010.  Make that four times with Q3’20 S&P 500 bottom-up EPS rising +4.1% during the quarter.  Btw, S&P 500 EPS are now expected to decline -21.2% year-over-year in Q3, -12.7% in Q4 and rise +12.6% during Q1’21.