Record-High Number of S&P 500 Companies Issuing EPS Guidance for Q3 2023

As of today, 116 S&P 500 companies have issued EPS guidance for the third quarter. Of these companies, 74 have issued negative EPS guidance and 42 have issued positive EPS guidance.

The percentage of companies issuing negative EPS is 64% (74 out of 116). This percentage is above the 5-year average of 59% but equal to the 10-year average of 64%.

The number of companies issuing negative EPS guidance is above the 5-year average of 58 and above the 10-year average of 63. However, the number of companies issuing positive EPS guidance is also above the 5-year average of 39 and above the 10-year average of 36.

As a result, the overall number of S&P 500 companies issuing EPS guidance for the third quarter (116) is above the 5-year average of 97 and above the 10-year average of 99.

In fact, this is the highest number of S&P 500 companies issuing EPS guidance for a quarter since FactSet began tracking this metric in 2006. The current record-high number is 113, which occurred in the prior quarter (Q2 2023). The third quarter also marks the third consecutive quarter in which the number of S&P 500 companies issuing quarterly EPS guidance has increased.

At the sector level, Information Technology is the main driver of the increase in the overall number of S&P 500 companies issuing quarterly EPS guidance in recent quarters. For Q3 2023, 45 companies in the Information Technology sector have issued quarterly EPS guidance, which is above the 5-year average of 38 and above the 10-year average of 35. If 45 is the final number for the quarter, it will tie the mark with Q2 2022 (45) for the highest number of companies in the Information Technology sector issuing EPS guidance for a quarter since FactSet began tracking this data in 2006. However, at least 40 companies in this sector have been issuing quarterly EPS guidance since Q1 2022.

Outside of the Information Technology sector, the Materials, Industrials, and Consumer Staples sectors all have more companies issuing EPS guidance for Q3 2023 relative to their 5-year and 10-year averages.

It is interesting to note that 104 S&P 500 companies have issued revenue guidance for the third quarter. This number is also the highest number of companies issuing revenue guidance for a quarter since FactSet began tracking this metric in 2006. The current record-high is 101, which also occurred in the prior quarter (Q2 2023).

Thus, it appears more S&P 500 companies have confidence in their visibility on earnings over the near term compared to recent quarters, given the record-high number of S&P 500 companies issuing EPS and revenue guidance for the third quarter.

The term “guidance” (or “preannouncement”) is defined as a projection or estimate for EPS (or revenue) provided by a company in advance of the company reporting actual results. Guidance is classified as negative if the estimate (or midpoint of a range estimates) provided by a company is lower than the mean EPS estimate (or revenue estimate) the day before the guidance was issued. Guidance is classified as positive if the estimate (or mid-point of a range of estimates) provided by the company is higher than the mean EPS estimate (or revenue estimate) the day before the guidance was issued.

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