In One Chart: Fewer S&P 500 companies mention ‘inflation’ during earnings calls despite elevated concern over price pressures


Fewer companies in the S&P 500 index cited “inflation” in their recent earnings calls, though mentions remain relatively high, according to FactSet’s senior earnings analyst John Butters. 

He said in a note Friday that 325 S&P 500 companies have cited “inflation” during their earnings calls for the fourth quarter, the lowest number since the third quarter of 2021. That’s a 20% decline from the third quarter of 2022, representing the largest quarter-over-quarter percentage drop since the first three months of 2020, when inflation mentions plunged 58%, according to the note.


Still, S&P 500 companies seem more worried about inflationary pressures than usual, with the number of companies so far citing “inflation” in their earnings calls for the fourth quarter remaining “above the 5-year average of 201 and above the 10-year average of 157,” according to Butters. 

Plus, “there are still about 30 S&P 500 companies that have not reported actual earnings for the fourth quarter,” he said. “So while the final number will likely finish higher than 325, it will fall short of the 404 from the previous quarter.”

The Federal Reserve’s preferred inflation measure, core data from the personal-consumption-expenditures price index, was hotter than expected in January.

Core PCE data, which excludes food and energy prices, jumped 0.6% last month for a year-over-year rate of 4.7%, the Bureau of Economic Analysis said Friday.

U.S. stocks ended sharply lower Friday as worries over sticky inflation weighed on the market, with the S&P 500 SPX, -1.05% falling 1.1%. The index booked a weekly loss of 2.7%, sliding for a third straight week, according to Dow Jones Market Data. The Dow Jones Industrial Average DJIA, -1.02% dropped 336.99 points, or 1%, leaving it with a 3% weekly fall.

While high inflation has eased from its 2022 peak, investors remain concerned the Fed may need to be more aggressive raising interest rates than previously anticipated to bring it under control.

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