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Where Are Analysts Most Optimistic on Ratings for S&P 500 Companies for 2022?

Earnings

By John Butters  |  December 20, 2021

With the end of the year approaching, where are analysts most optimistic and pessimistic in terms of their ratings on stocks in the S&P 500?

Overall, there are 10,785 ratings on stocks in the S&P 500. Of these 10,785 ratings, 56.8% are Buy ratings, 37.2% are Hold ratings, and 6.0% are Sell ratings.

At the sector level, analysts are most optimistic on the Energy (67%), Communication Services (62%), Information Technology (62%), and Health Care (61%) sectors, as these four sectors have the highest percentages of Buy ratings. On the other hand, analysts are most pessimistic on the Consumer Staples (42%) sector, as this sector has the lowest percentages of Buy ratings. This sector also has the highest percentage of Hold ratings (48%) and Sell ratings (10%).

sp-500-percentage-buy-hold-sell-ratings

The S&P 500 companies with the highest percentages of Buy ratings and Sell ratings can be found in the tables below.

Highest % of Buy Ratings in S&P 500: Top 10 (Source: FactSet)

Company

Buy

Hold

Sell

Alexandria Real Estate Equities, Inc.

100%

0%

0%

Assurant, Inc.

100%

0%

0%

Amazon.com, Inc.

96%

4%

0%

Alphabet Inc. Class C

96%

4%

0%

Alphabet Inc. Class A

94%

6%

0%

Caesars Entertainment Inc

94%

6%

0%

Catalent Inc

93%

7%

0%

Alaska Air Group, Inc.

93%

7%

0%

Visa Inc. Class A

92%

8%

0%

AES Corporation

92%

8%

0%

Highest % of Sell Ratings in S&P 500: Top 10 (Source: FactSet)

Company

Buy

Hold

Sell

Consolidated Edison, Inc.

0%

35%

65%

Lumen Technologies, Inc.

14%

43%

43%

Clorox Company

17%

44%

39%

Robert Half International Inc.

38%

23%

38%

Expeditors Intl. of Washington, Inc.

13%

50%

38%

Progressive Corporation

32%

32%

37%

Snap-on Incorporated

36%

27%

36%

Brown-Forman Corporation Class B

6%

61%

33%

Fastenal Company

13%

53%

33%

American Airlines Group, Inc.

23%

45%

32%

It is interesting to note that even with a 24% price increase since the end of last year (December 31, 2020), analysts are more optimistic on S&P 500 stocks today compared to December 31, 2020, based on the percentages of Buy ratings. On December 31 (2020), 53.7% of ratings on S&P 500 stocks were Buy ratings compared to 56.8% today. Nine sectors have a higher percentage Buy ratings now compared to December 31 (2020), led by the Real Estate (to 54% from 47%) and Materials (to 56% from 50%) sectors. Two sectors have a lower percentage of Buy ratings now compared to December 31 (2020): Consumer Staples (to 42% from 46%) and Utilities (to 49% from 51%).

sp-500-buy-ratings-percent-dec-2021-vs-dec-2020

However, there has been no change at the sector level in terms of the sectors with the highest percentages of Buy ratings. The same four sectors (Communication Services, Energy, Health Care, and Information Technology) that had the highest percentages of Buy ratings on December 31, 2020 also have the highest percentages of Buy ratings today. In terms of price performance, the Energy sector (+46.1%) has witnessed the largest price increase and the Information Technology sector (+29.4%) has seen the fourth-largest price increase of all 11 sectors since the end of last year, while the Health Care sector (+22.0%) has seen the sixth-largest price increase and the Communication Services sector (+19.3%) has seen the seventh-largest price increase of all 11 sectors over this time frame.

Listen to Earnings Insight on the go! In our weekly Earnings Insight podcast, John Butters provides an update on S&P 500 corporate earnings and related topics based on his popular Earnings Insight publication. The podcast is made available every Monday—listen on Apple podcasts, Spotify, or factset.com.

The information contained in this article is not investment advice. FactSet does not endorse or recommend any investments and assumes no liability for any consequence relating directly or indirectly to any action or inaction taken based on the information contained in this article.

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John Butters

Vice President, Senior Earnings Analyst

Mr. John Butters is Vice President and Senior Earnings Analyst at FactSet. His weekly research report, “Earnings Insight,” provides analysis and commentary on trends in corporate earnings data for the S&P 500 including revisions to estimates, year-over-year growth, performance relative to expectations, and valuations. He is a widely used source for the media and has appeared on CNBC, Fox Business News, and the Business News Network. In addition, he has been cited by numerous print and online publications such as The Wall Street Journal, The Financial Times, The New York Times, MarketWatch, and Yahoo! Finance. Mr. Butters has over 15 years of experience in the financial services industry. Prior to FactSet in January 2011, he worked for more than 10 years at Thomson Reuters (Thomson Financial), most recently as Director of U.S. Earnings Research (2007-2010).

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