Daily Traders Edge

1 Big Reason Stocks Should Be Soaring Higher

July 29
10:56 2021

(Please enjoy this updated version of my weekly commentary from the Reitmeister Total Return newsletter).

Everything we have discussed about the market the past two months remains the same. That being the illusion of the conservative stocks in the S&P 500 making new highs as the overall market is actually in Risk Off mode with most groups seeing stiff corrections. Unfortunately that situation is unchanged.

Instead, let’s turn our attention to Q2 earnings season because it is important to appreciate the early trends as we enter the heart of earnings season. This is especially true as nearly all our portfolio reports in the next couple weeks so we will want to be prepared for what is likely to come next.

Market Commentary

Long story short, this looks like another spectacular earnings season. Here are some of the key stats as gathered this morning by industry friend, Nick Raich of EarningsScout.com.

  • In total, 152 companies in the index have now reported 2Q 2021 results.
  • 89% have exceeded their EPS estimates, on average, by +18.93%.
  • Collectively, 2Q 2021 EPS is up +102.85% over 2Q 2020 for these 152 companies.
  • 86% have topped sales estimates, on average, by +4.40%.

The above is pretty spectacular. Not just the percentage of companies beating estimates. But also the magnitude of the beats on both the top and bottom line.

Then you have the notion that we have enjoyed a string of strong earnings seasons in a row. This leads to elevated expectations which at times can be harder and harder to topple. So that makes the percentage and magnitude of the beats that much more impressive.

Continue Reading at StockNews.com

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