Last year, the market was scrambling to lower its earnings expectations. Now, the pendulum has swung the other way.
After several big names beat not only analysts' consensus estimates but Wall Street's whisper numbers — the unofficial numbers buzzing around the market — it set expectations for earnings and the recovery pretty high.
But last week, Goldman Sachs got burned by the whisper numbersafter JPMorgan’s stellar beat. Goldman delivered a strong report by most accounts, handily beating analysts’ expectation. But because it fell short of the whisper numbers, which some said went as high as $6 a share, nearly two bucks above consensus, traders punished the stock — as well as other financials.
Today, tremendous beats by Apple and Caterpillar boosted those stocks but weren’t able to help the market keep its rally going.
Has Wall Street gotten a little ahead of itself on earnings expectations? Are the whisper numbers setting the bar too high?
Take our poll and cast your vote. Plus, offer your comments below.
- Apple Crushes Forecasts; Shares Jump
- Caterpillar Trounces Estimates, Boosts Outlook
- Goldman Beats Expectations But Shares Sink