Earnings season is underway, and it’s off to a weird start.

Johnson & Johnson (JNJ), JPMorgan Chase (JPM), Wells Fargo (WFC), and Fastenal (FAST) were among big companies announcing first quarter results on Tuesday.

All four companies confirmed that the coronavirus pandemic is a negative for earnings. And yet shares of J&J and Fastenal are rallying on the news. (After an initial pop, the bank stocks were lower in early afternoon trading.)

Given the market reaction, one can speculate that what these companies said about their earnings and the outlook wasn’t much worse than what investors and traders expected. Because as investors know, bad news can send stocks higher if the market was expecting worse.

But a one-day rally in any stock doesn’t mean things suddenly look rosy. These names are still well off recent highs as the market continues to price in the fact that the business environment is worse today than it was before the coronavirus pandemic. As you can see from the chart below, this is the case for the stock market in aggregate.

Forget about consensus estimates. They’re stale.

One thing we’re not talking about right now is how these companies’ Q1 results performed against analysts’ expectations.

That’s because analysts expectations have been very low quality, and the dispersion of estimates has been so wide that average estimates don’t make a whole lot of sense.

Furthermore, we know that a lot of the analysts’ estimates that go into these consensus expectations haven’t been updated since before the coronavirus outbreak evolved into a global economic crisis. This has been due to the utter lack of visibility. In other words, many of these estimates are inflated by the mere fact that they have not been updated.

“While many analysts were hamstrung by uncertainty and the lack of management guidance for much of the last several weeks, revisions have been accelerating ahead of earnings reports,” Goldman Sachs’ David Kostin wrote on Monday. “Nonetheless, we believe they remain too high.”

In other words, you may find a lot of companies reporting Q1 revenue and earnings that “missed” estimates, but shares rallied anyways because the market was already expecting worse.

Keep an eye on the details

This time around, investors will be less interested on whether sales and earnings “beat” or “missed” expectations. Rather, they’ll be more interested on what details emerge, including those one-time, non-recurring items that often get adjusted out.

“Earnings results will be even worse than we forecast if company managements decide to recognize charges and write-downs during a quarter that many investors accept will be very negative,“ Kostin said.