With a new year comes a look at the old. The fourth-quarter earnings season will kick off in the coming week with a number of high-profile companies reporting their performances over the last months of 2016.
Average earnings for the S&P 500 in the fourth quarter are expected to increase 4.4% from the same period a year earlier. Earnings growth would mark the second straight quarter of gains after the third quarter broke an earnings recession that lasted for four consecutive quarters. Earnings grew 4% in the third quarter of 2016.
"We believe investors are pricing in a beat for fourth-quarter earnings," said Lindsey Bell, investment strategist at S&P Capital IQ. "EPS growth hasn't fallen short of expectations since first quarter 2009 and the past two quarters had solid beat rates of 4.9% and 3.5%, respectively. As long as investors don't anticipate a greater-than-average beat, fourth-quarter earnings shouldn't rock the market.
Also on the earnings calendar, Acuity Brands (AYI) , Apollo Education Group (APOL) and Barracuda Networks (CUDA) will report on Monday; Progress Software (PRGS) on Tuesday; HB Fuller (FUL) and KB Home (KBH) on Wednesday; and Delta Air Lines (DAL) and FuelCell (FCEL) on Thursday.