More US companies offer earnings guidance despite pandemic

An employee stands outside a Gucci store on the first day of the phase two re-opening of businesses following the outbreak of the coronavirus disease (COVID-19), in the Manhattan borough of New York City, US. (Reuters)
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Updated 24 October 2020

More US companies offer earnings guidance despite pandemic

  • The S&P 500 index is up nearly 7 percent year to date

NEW YORK: With earnings season in full swing, more companies are again offering earnings guidance, signaling to investors that some corporations are adapting to uncertainty about a global pandemic that may extend deep into next year.

Overall, 73 companies in the S&P 500 index have offered guidance this quarter so far, up from last quarter’s 65 pre-announcements but well below the 170 companies that typically offer guidance, according to Refinitiv data. The companies offering guidance are giving the most bullish expectations in Refinitiv data going back to 1997.

“If a company is able to offer guidance it shows that they’re able to have a better idea of what’s coming down the road,” said Charlie Ripley, senior investment strategist at Allianz Investment Management.

The market has been buffeted by cross-currents related to the looming Nov. 3 US presidential election, drawn out fiscal stimulus talks in Washington and a resurgent pandemic. Still, investors appear more hopeful in recent months.

Fifty percent of high net worth US investors surveyed by UBS Global Wealth Management voiced optimism on the economy, up from 41 percent three months prior, with 55 percent optimistic on stocks, up from 44 percent. The S&P 500 index is up nearly 7 percent year to date, including a 2.2 percent gain since the start of October.

So far this quarter, shares of AT&T Inc, Verizon Communications Inc. and Quest Diagnostics Inc. have rallied after each company gave investors updated guidance on how they expect to fare over the next fiscal year.

“It’s not surprising we’ve had so many beats this quarter because we entered the season with very little guidance,” causing analysts to slash their estimates, said Katie Nixon, chief investment officer at Northern Trust Wealth Management.


Scammers fool Britons with investment firm clones, says trade body

Updated 28 November 2020

Scammers fool Britons with investment firm clones, says trade body

  • Losses amounted to 9.4 million pounds ($12.56 million) between March and mid-October

LONDON: More than 200 British retail investors have lost nearly 10 million pounds ($13.4 million) in total to sophisticated investment scams since a government lockdown in March to fight the COVID-19 pandemic, a trade body said on Saturday.
Fraudsters cloned genuine investment management firms’ websites and documentation, and advertised fake products on sham price comparison websites and on social media, the Investment Association said.
Greater financial uncertainty and more time spent online have likely contributed to the increase in scams, industry sources say.
Losses amounted to 9.4 million pounds ($12.56 million) between March and mid-October, the IA said, based on information it got from member firms which had been cloned.
“In a year clouded in uncertainty, organized criminals have sought opportunity in misfortune by attempting to con investors out of their hard-earned savings,” Chris Cummings, chief executive of the Investment Association said.
The investment management industry was working closely with police and regulators to stop the scams, he added.
Britain’s Action Fraud warned earlier this month that total reported losses from all types of investment fraud came to 657 million pounds between September 2019 and September 2020, a rise of 28% from a year ago. Reports spiked between May and September, following Britain’s first national lockdown, the national fraud and cybercrime reporting center added.