Tag: earnings estimates

How Will Q3 and Q4 EPS Seasons Play Out?

How Will Q3 and Q4 EPS Seasons Play Out?

Companies will largely take a conservative approach to guidance on the Q3 and Q4 EPS calls. The rubber will meet the road on the Q4 earnings calls in January when companies issue their initial 2024 guidance. That initial 2024 guidance will likely spook investors and knock stock prices back significantly. Hopefully management teams stopped listening … Continue reading How Will Q3 and Q4 EPS Seasons Play Out?

Earnings Growth Rates Will Decline In 2024

Earnings Growth Rates Will Decline In 2024

When I look at Technology company earnings estimates for 2024 they appear too bullish. 2024 EPS growth rates will decline. For many companies EPS will go negative on an absolute basis (2024 EPS as compared to 2023). Here are some reasons why: Revenue growth will decline: Revenue growth will decline for many Technology companies as … Continue reading Earnings Growth Rates Will Decline In 2024

Enterprise Software Earnings Outlook: Get Ready For Conservative Outlooks

Enterprise Software Earnings Outlook: Get Ready For Conservative Outlooks

First, an administrative detail: TEK2day readers may now find TEK2day on Substack HERE. We will publish our articles both here as well as on Substack. With respect to Enterprise Software earnings, I suspect that most Software companies will take a more conservative approach to their Q4 2023 and early 2024 outlooks as compared to prior … Continue reading Enterprise Software Earnings Outlook: Get Ready For Conservative Outlooks

Weak Earnings & Buybacks

Weak Earnings & Buybacks

Get ready for an uptick in share repurchase plan announcements. This earnings season as Technology companies issue weak guidance you can be sure that many of those companies will announce new share repurchase agreements to support stock prices. Share repurchase agreements are a waste of capital in my view. CEOs should invest in their businesses … Continue reading Weak Earnings & Buybacks

How Low Will Valuations Go?

How Low Will Valuations Go?

The S&P 500 is approximately at its long-term average P/E multiple of 20x (if one looks back to 1964). However, that multiple could go lower should the Fed hold rates higher for a longer period than what many investors expect. Further, markets tend not to bottom until after the Fed begins to cut rates (we … Continue reading How Low Will Valuations Go?

Q4’22 EPS Call Buzzword: “Cautious”

Q4’22 EPS Call Buzzword: “Cautious”

Get ready to hear the word "cautious" repeated ad nauseam on forthcoming Technology company EPS calls this month and next. Temenos (tkr: TEMN), is one such example. You may read the FinTech company's Q4 press release here: https://www.temenos.com/news/2023/01/16/temenos-pre-announces-preliminary-q4-and-fy-2022-results-bxf9181m/ Temenos also announced a CEO change. I expect to see more CEO changes than normal in 2023. … Continue reading Q4’22 EPS Call Buzzword: “Cautious”

Equities Over The Next 2-3 Months

Equities Over The Next 2-3 Months

Back to the office, equities will sell off. We expect that equities will trade off when investors return to the office in January in anticipation of soft earnings. Technology stocks will be hit the hardest. Another leg down on EPS reports. When earnings are reported in January and early February, there will be another leg … Continue reading Equities Over The Next 2-3 Months

Not So Fast. This Won’t Be Quick & Painless.

Not So Fast. This Won’t Be Quick & Painless.

The 2008 downturn and the current downcycle have similarities as far as investor sentiment is concerned. We believe that investor sentiment will sour early next year as Q4 2022 earnings reports come in. 2023 earnings estimates and stock prices will move lower off of the Q4 EPS reports. Early cycle disbelief. I recall that in … Continue reading Not So Fast. This Won’t Be Quick & Painless.

Markets Have Another Leg Down

Markets Have Another Leg Down

This spring when I said the NASDAQ would bottom around 9,000 my thinking was as follows: 2022 would be a year where higher interest rates reset equity valuations lower, especially as it relates to the NASDAQ Composite. 2023 would be a year where poor company fundamentals reset equity valuations lower. The NASDAQ has experienced some … Continue reading Markets Have Another Leg Down

It Is Best For Companies To Be Conservative On Q3 EPS Calls

It Is Best For Companies To Be Conservative On Q3 EPS Calls

It is best for companies to be conservative with their Q4 and 2023 outlook on EPS calls. We are 1/6 through Q4 and Technology companies have to be seeing weaker demand today versus 3 and 6 months ago. Enterprise Technology companies are likely seeing deals of all sizes get pushed back in the pipeline - … Continue reading It Is Best For Companies To Be Conservative On Q3 EPS Calls