[ad_1]
After many stocks have rallied during the best quarterly earnings season in nine years, investors have begun to look at the current quarter and the coming year – and the outlook for 2019 is not great.
Wall Street badysts are cutting their profit forecasts so much for the first quarter of 2019 that the overall estimate of earnings growth for the period has just turned negative. According to FactSet, profits should now fall by an average of 0.8%. This is quite a reversal compared to September, when badysts were expecting an increase of nearly 7% in their profits. Blame the bad business prospects accompanying the high figures of the fourth quarter.
The drop in expectations corresponds to that of Mike Wilson, chief equity strategist at Morgan Stanley, who warned against a profit recession.
"Revenues are deteriorating even faster than expected," Wilson said in a note on Monday. "The magnitude of the earnings review over the past month has been even more negative than expected, which has led us to think [the] the trough of the recession in the United States could be later than 1Q and deeper. "
Source link
