10 Stocks Wall Street Analysts Hate Going into 2023

news7f12/18/2022

1 2 minutes read

10 Stocks Wall Street Analysts Hate Going into 2023

Wall Street analysts don’t expect the S&P 500 companies to hit the ground running with fourth-quarter earnings when they start releasing in January.

In fact, quite the opposite, like slow economic growthRising interest rates and persistent inflation make strategists cautious about the stock market in 2023.

Fourth-quarter earnings for S&P 500 companies are expected to fall 2.8%, according to new data from FactSet. If that turns out to be true, it would mark the first earnings drop reported by the S&P 500 since Q3 2020 when profits fell 5.7%.

FactSet data shows that expectations for corporate profits have begun to trend downward. Fourth-quarter earnings-per-share estimates have fallen 6.1% since September 30.

Traders work on the floor of the exchange at the New York Stock Exchange (NYSE) in New York City, U.S., December 14, 2022. REUTERS/Andrew Kelly

“Slowing nominal activity means lower revenue growth and downward pressure on margins,” writes Study 22V founder Dennis DeBusschere in a client note. “At the same time, management sentiment towards futures earnings, as measured by Utilities’ natural language processing engine, has turned profoundly negative. The long-anticipated drop in earnings arrived.”

Despite a long list of reasons — chief among them the aforementioned earnings weakness — to be cautious about the stock during the upcoming earnings season, analysts continue to be optimistic. relative to their ratings.

There are 10,835 ratings for stocks in the S&P 500, FactSet points out. Of these 10,835 ratings, 55.3% are buy ratings, 38.8% are hold and 5.9% are sell ratings.

But some stocks in the S&P 500 have sell ratings – suggesting that analysts really don’t care about these stories.

Companies like Principal Financial Group, T. Rowe Price Group and ConEd have more than 50% of analysts rating stocks as Sell.

So, as investors look to bounce back from a challenging year in the markets, here are a few names that Wall Street is least confident in will help turn the tide for your portfolio.