As we approach the start of earnings season, something is stirring in the earnings per share (EPS) guidance data, and it’s coming from exactly where you’d expect.
Roughly seven of every 10 positive earnings guidance across the S&P 500 is coming from a single corner of the market. — That’s nearly double the sector’s five-year average of roughly 23.
Companies don’t talk up a quarter unless they’re fairly sure they can back it up — guide high and then whiff, and the selling is immediate and merciless.
So when the chipmakers, cloud platforms and software shops raise the bar on themselves this aggressively, all at once, it’s worth asking what they see.
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