Quarterly Earnings Watch

Q3 2020 | Notes from the Global Growth Equity Desk

By Laura Granger and Jonathan Bauman

Key Takeaways

  • Most companies beat earnings expectations, which are rising as analysts grow more optimistic heading into 2021. The magnitude of the earnings “beats” again set records.
  • The market had a muted reaction to earnings news due to concern about the pandemic and U.S. politics.
  • Cyclical companies dependent on strong economic growth lagged, though European cyclicals showed signs of improving.
  • Surprisingly strong auto sales are emerging as a new theme. Enduring trends supporting green energy, 5G and pandemic-driven changes in consumer behavior remained key earnings drivers.
  • Despite the progress, we don’t expect earnings to reach pre-pandemic levels until late 2021 or 2022.

With the spread of COVID-19 worsening and noise from the U.S. presidential election rising, the market had a muted reaction to earnings news.


Quarterly Earnings Watch

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