Trading this earnings season may be 'high-risk, high-reward': Barclays strategist Brian Sozzi · Executive Editor Mon, October 12, 2026 at 12:25 PM EDT 2 min read ^GSPC -0.05% NVDA -1.25% DAL -1.75% PEP +0.80% Explore stocks on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Trading this earnings season won't be for the faint of heart.
"We think trading the prints this season could be high-risk, high-reward," Barclays strategist Venu Krishna warned. "Stocks should have scope to deliver more upside in response to beat-and-raise, while missed guidance could be penalized more severely."
Krishna is concerned on multiple fronts, from investors having plowed into top tech names such as Nvidia (NVDA) ahead of earnings to tepid interest in non-tech stocks.
"Market internals give reason for caution. High-beta leadership, similar to that which has underpinned index levels over recent weeks, tends to precede larger selloffs in reaction to guidance misses," Krishna added.
Negative reactions to earnings guidance warnings from Delta (DAL) and PepsiCo (PEP) to kick off the reporting season underscore Krishna's point.
S&P 500 (^GSPC) third quarter earnings growth is expected to come in at 29.6% year over year.
If 29.6% is the actual growth rate for the quarter, it will mark the third straight quarter of growth above 25%, according to FactSet.
It would also represent the eighth straight quarter of double-digit percentage earnings growth.
Go deeper with AlphaSpace 7,807.50 -4.04 (-0.05%) As of 12:45:23 PM EDT. Market Open. "Growth expectations remain high and we think companies can deliver," Krishna said. "Survey and sentiment metrics weakened across the consumer and corporate landscape in reaction to persistent cost pressure and rising rates, yet hard data continues pointing to robust aggregate demand. Strong activity and pricing should form a healthy backdrop for corporate earnings."
For the fourth quarter, Wall Street analysts are calling for earnings growth of 28%.
Analysts are predicting year-over-year earnings growth of 32.7% for 2026. Earnings are seen up 15.6% for 2027.
Brian Sozzi is Yahoo Finance's Executive Editor, host of the Sozzi Unleashed morning show and the Power Players with Brian Sozzi podcast, and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.
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