Analysts lower S&P 500 quarterly earnings estimates

As earnings season heats up, it's an opportune time to examine analysts' quarterly expectations. Over the three months ended Sept. 30, analysts lowered their earnings per share estimates for S&P companies by an aggregate of 6.6%, to a median of $55.51. The quarterly decrease compares to 1% and 1.2% declines during the first and second quarters, respectively. Before the start of this year, analysts raised their estimates for six consecutive quarters.

Analysts increased their third-quarter earnings estimates by 7.9% for the energy sector and lowered them for the other 10 sectors. Consumer discretionary, communication services, and materials saw the biggest drop in quarterly estimates.

An analysis of third-quarter earnings guidance provided by management shows that 41 companies gave a higher outlook than the consensus estimate and 65 were below. The last time more companies issued positive guidance than negative was a year ago.

The real estate sector was the only one that had more companies issuing positive earnings guidance than a negative one.