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Over half of S&P 500 has shelved or cut guidance since coronavirus – tracker


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Over half of S&P 500 has shelved or cut guidance since coronavirus – tracker

More than half of the companies in the S&P 500 have withdrawn or lowered financial guidance over COVID-19, after 19 more companies in the large-cap index cut or suspended their financial projections from May 7 to May 13, according to an S&P Global Market Intelligence analysis.

The tally, now totaling at least 251, is based on searches of news releases, regulatory filings, financial results, earnings calls and conference speech transcripts by S&P 500 companies. All 251 mentioned the pandemic in altering their guidance on key financial metrics.

The sector with the most outlook withdrawals in the week to May 13 was healthcare, which saw six companies most of which were equipment manufacturers abandon guidance over the ongoing uncertainty on the duration of the outbreak.

Medical device company Becton Dickinson and Co. withdrew its outlook for fiscal 2020, with management stating on its fiscal second-quarter earnings call that the "timing and phasing of research and more elective healthcare returning is hard to predict." The company reported a 1.5% year-over-year decrease in adjusted EPS for the quarter.

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Precision instruments manufacturer Mettler-Toledo International Inc. declined to provide formal sales and adjusted EPS earnings guidance for the full year, stating on its earnings call that because it is a short-backlog business, coming up with an outlook beyond the second quarter is "extremely challenging." The company estimated that local currency sales in the second quarter would decline by 8% to 12%.

Pharmaceutical products provider AmerisourceBergen Corp. revised its adjusted diluted EPS guidance for fiscal 2020 to $7.35 to $7.65, from $7.55 to $7.80, while biopharmaceutical group Bristol-Myers Squibb Co. revised EPS guidance to a range of 37 cents to 57 cents from a previous forecast of 75 cents to 95 cents.

Other healthcare companies to withdraw full-year guidance were dental product and technology group DENTSPLY SIRONA Inc., which cited uncertainty over the duration of the pandemic, and medical device maker STERIS PLC, which flagged a decline in procedure volumes late in the fiscal fourth quarter due to COVID-19.

The S&P 500 information technology sector yielded four guidance withdrawals during the last week, including business and financial software company Intuit Inc., which withdrew its previously provided fiscal 2020 guidance, citing uncertainty in small-business trends. The company said it expects revenue, operating income and earnings for its third fiscal quarter to be lower than previously guided. Financial services technology provider Fiserv Inc. also withdrew guidance, citing the virus' negative impact on global economic activity.

FleetCor Technologies Inc., which provides fuel cards and workforce payment products, suspended its full-year 2020 guidance, with management stating there was "too much uncertainty regarding the resumption of business activity" during its first-quarter earnings call. The group expects the second quarter to be the lowest in terms of volume and revenue.

Withdrawing its full-year guidance on the back of uncertainties surrounding its severity, impact and duration of the virus, data communications and telecommunications equipment provider Motorola Solutions Inc. confirmed on its earnings call that it expects second-quarter sales to be down between 14% and 17%. However, the company also said the pandemic has "confirmed the fundamental need" for its "mission-critical solutions."

S&P Global Market Intelligence also tracked three withdrawals from the real estate sector Iron Mountain Inc., CBRE Group Inc. and Simon Property Group Inc. and two amendments from the utilities sector, Consolidated Edison Inc. and Exelon Corp..

In the S&P 500 materials sector, industrial gas company Linde PLC now expects to register annual growth in the medium to high single-digit-percentage range, from a previous forecast of full-year EPS growth of 10% to 13%, while International Flavors & Fragrances Inc. withdrew guidance altogether.

Elsewhere, communications group CenturyLink Inc. suspended its full-year 2020 financial outlook for adjusted EBITDA, free cash flow and capital expenditures. And in the industrial sector, Raytheon Technologies Corp., the new company formed through the merger of United Technologies Corp. and Raytheon Co., refrained from providing guidance, flagging the pandemic's impact on its business and the aerospace sector.

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S&P Global Market Intelligence also tracked at least nine companies in the traditionally defensive S&P 500 utilities sector that reassured investors that earlier guidance remained in place.

In the past week, those to reaffirm guidance in their quarterly earnings reports included Xcel Energy Inc. CenterPoint Energy Inc., Alliant Energy Corp., PPL Corp., Pinnacle West Capital Corp., Ameren Corp., Duke Energy Corp., Entergy Corp. and NRG Energy Inc.

Healthcare company Healthcare Mylan NV also reaffirmed earnings guidance for the year, while General Mills Inc., a constituent of the S&P 500 consumer staples sector, now expects to exceed each of its previous full-year fiscal 2020 guidance ranges.