Voya’s Zemsky Says Expectation Surprises Reflect Executives’ Cautious Guidance Amid Uncertainty
Bloomberg reports stock estimates from Wall Street analysts have begun to miss by a margin significantly larger than normal as companies across numerous industries continue beating expectations. The FAANG tech stocks “have crushed analysts’ sales estimates by 8.4% for the latest calendar quarter, the best showing on record, data compiled by Bloomberg show,” and it isn’t only “the megacaps that are smashing expectations.” Firms from almost every industry are “doing better, with widespread profit beats seeing little precedent.” Voya Financial Multi-Asset Strategies and Solutions CIO Paul Zemsky said the surprise performances reflect the caution among corporate executives, who usually shape analysts’ views through their guidance, given the ongoing uncertainty amid the pandemic. Zemsky said, “Given how much economic growth depends on policy being right — and it has been right up to now — I can see why companies are hesitant to give too much guidance ... Companies are reluctant to guide higher because there’s still a tremendous amount of uncertainty.”