Optimistic CEO Upside Surprises
By Barry Ritholtz – The Big Picture
It turns out its not just the wealthy who are feeling more optimistic. According to a Bloomberg analysis, more companies are raising earnings forecasts versus those who are cutting them. The gap between the two is as large as its been since Bloomberg began tracking the data.
More U.S. executives than ever are increasing earnings forecasts compared with those lowering them, helped by almost $2 trillion of Federal Reserve spending and a recovery in the global economy.
EBay, UPS, and 196 other companies raised profit estimates above analysts’ projections versus 130 firms that cut them. This is the biggest gap since Bloomberg began tracking the data in 1999.
Companies are raising the outlook for U.S. profits at the same time the Fed is trying to prevent deflation and reduce unemployment by purchasing an additional $600 billion in Treasuries. The last time executives were this optimistic, stocks climbed 39% over the next 3 1/2 years, data compiled by Bloomberg show . . .
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