Where Are Analysts Most Optimistic on Ratings for S&P 500 Companies Heading Into Q4?

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

Overall, there are 11,882 ratings on stocks in the S&P 500. Of these ratings, 54.5% are Buy ratings, 40.2% are Hold ratings, and 5.2% are Sell ratings. The percentage of Buy ratings is slightly below its the 5-year (month-end) average of 54.6%. The percentage Hold ratings is above its 5-year (month-end) average of 39.4%. The percentage of Sell ratings is below its 5-year (month-end) average of 6.0%.

At the sector level, analysts are most optimistic on the Communication Services, Energy, and Information Technology sectors, as these three sectors have the highest percentages of Buy ratings at 64%, 62%, and 61%, respectively. On the other hand, analysts are most pessimistic on the Consumer Staples, Utilities, and Materials sectors, as these three sectors have the lowest percentages of Buy ratings at 43%, 48%, and 49%, respectively. The Consumer Staples sector has the highest percentage of Hold ratings at 50%, while the Utilities sector has the highest percentage of Sell ratings at 9%.

The ten S&P 500 companies with the highest percentages of Buy ratings and Sell ratings can be found below. Three of the top four companies with the highest percentage of Buy ratings are also “Magnificent 7” companies: Amazon.com, Microsoft, and NVIDIA.

After rising to 55.2% at the end of June 2024, the overall percentage of Buy ratings for the S&P 500 has decreased for three straight months to 54.6% today. At the sector level, the Consumer Staples (to 42.8% from 45.9%) and Utilities (to 48.0% from 50.5%) sectors have seen the largest decreases in their percentages of Buy ratings of all eleven sectors since the end of June. On the other hand, the Communication Services (to 63.7% from 62.4%) and Materials (to 49.3% from 48.1%) sectors have seen the largest increases in their percentages of Buy ratings during this period. Overall, the value of the S&P 500 has increased by 4.6% (to 5,713.64 from 5,460.48) since June 30.

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