November was an active month for guidance from S&P 500 companies, as 40 companies issued quarterly EPS guidance for Q4 2012 and 93 companies issued annual EPS guidance for the current fiscal year during the month. For Q4 2012 overall, 78 companies have issued negative EPS guidance, while 29 companies have issued positive EPS guidance. As a result, 73% (78 out of 107) of the companies that have issued EPS guidance for Q4 2012 have issued negative EPS guidance. If 73% is the final percentage, the Q4 2012 quarter will tie the Q4 2011 quarter (73%) as the quarter with the second-highest percentage of companies issuing negative EPS guidance since FactSet began tracking the data in Q1 2006. The Q3 2012 quarter currently has the record, at 74%.
The main contributor to the high percentage of negative guidance for the index is the Information Technology sector. Of the 32 companies that issued EPS guidance for Q4 2012 in this sector, 29 (or 91%) have issued negative EPS guidance. Not only are more companies in the Information Technology sector issuing negative EPS guidance relative to other sectors, but these same companies are also issuing guidance below analyst estimates by the widest margins on average of any sector (-15.1%). Eight of the ten companies that have guided earnings below estimates by the largest margins for the fourth quarter to date are companies in the Information Technology sector.