2023 Q2 Earnings Season Highlights

The Q2 earnings season for the S&P 500 is well underway, and the majority of companies have already disclosed their second-quarter results.

As we await the results period later this month, let’s take a deep dive into the key highlights that reveal emerging trends and performance across various sectors.

Q2 Earnings Season: The S&P 500’s Q2 earnings season is showing positive trends with a higher number of companies reporting positive earnings surprises and exceeding estimates.

Earnings Surprises: 79% of the companies in the S&P 500 have reported actual EPS above estimates, the highest percentage since Q3 2021.

Revenue Trends: 65% of S&P 500 companies reported actual revenues above estimates, with companies reporting revenues 1.6% above estimates on average.

Sector Performance: Eight of eleven sectors are reporting year-over-year earnings growth, led by Consumer Discretionary and Communication Services sectors. Energy, Materials, and Health Care sectors reported earnings decline.

Future Guidance: For Q3 2023, 62% of companies in the index have issued negative EPS guidance, slightly above the 5-year average.

Valuation: The forward 12-month P/E ratio for the S&P 500 is 19.2, above the 10-year average of 17.4, indicating a relatively higher valuation in the market.

Source: FactSet

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