SP 500 Earnings: Forward Estimates Continue to be Revised Higher

The consistent and persistent strength in SP 500 earnings is pretty remarkable, and per last Monday, June 3rd’s detailed SP 500 earnings post, the SP 500 earnings patterns are still ongoing.

SP 500 data: 

  • The forward 4-quarter estimate rose again this week to $253.27 from last week’s $252.89, and early January’s $243.98. The SP 500 forward 4-quarter estimate has added $10 in just the first half of 2024, versus (as a contrast) the first 6 months of 2023 the forward 4-quarter estimate began January ’23 at $228.38 and ended up at $225 by mid-June ’23. 2022 is closer to 2024 in terms of growth in the forward estimate, even though the SP 500 benchmark was much lower by June, 2022, than today;
  • Using an approximate closing value for the SP 500 of 5,353, the PE on the forward estimate today is 21.1x versus last week’s 20.9x;
  • The SP 500 earnings yield fell slightly to 4.73% versus last week’s 4.79% as the SP 500 looks to be closing up roughly 1.5% on the week;
  • Upside surprises continue at 8.1% and 1.1% for SP 500 EPS and revenue;

Summary / conclusion: There is little change in the general trend of SP 500 earnings as what looks to be an almost perfect economy, as reflected in the SP 500’s eleven sectors. With the exception of health care, which has seen a big revision lower, and smaller negative revisions in energy and staples, the other 8 sectors of the SP 500 are seeing higher expected EPS growth rates as of June 7 ’24, versus late March ’24 and early January ’24.

While speaking with a friend yesterday who is a market technician, (while this blog usually focuses on fundamentals), I noted that it’s almost a perfect US economy, and this morning’s nonfarm payroll numbers reflect that. The jump in the unemployment rate to 4.0% will get some attention, but “jobs friday” is a report that’s made up of two different surveys, both the business and household surveys, and the surveys can deliver conflicting information.

Think of the SP 500 earnings data, as just another input to the investing equation.

None of this is advice or a recommendation. Past performance is no guarantee of future results. Investing can involve the loss of principal even over short periods of time. All SP 500 EPS and revenue data is sourced from the London Stock Exchange Group (LSEG), although this blog uses the data in other ways and configurations.

Thanks for reading.



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