Barron's Dimitra DeFotis writes, "With an unusually large percentage of companies revising their fourth-quarter estimates downward, prepare to see many results that miss the Street's current estimates."
DeFotis continues: (subscription required)
When earnings season begins in earnest during the second week of January, we may be looking for the grinch who stole fourth-quarter profits.
The number of companies in the Standard & Poor's 500 index that have made downward profit revisions is at a level not seen since the 2001 economic recession, making sell-side analyst projections look rosy. A total of 96 companies revised their fourth-quarter earnings estimates downward, while 27 companies revised them upwards.