The quarterly bump hit the earnings data this week, as the new forward 4-quarter estimate for the SP 500 rolled into the 4 quarters from Q4 ’25 to Q3 ’26.
The $10 increase in the forward 4-quarter estimate (FFQE) results in the new FFQE being $293.97, after last week’s final FFQE from Q3 ’25 through Q2 ’26 was $283.19.
Personally, I like this perspective on annual SP 500 since it shows rate-of-change for the annual estimates each week.
Note the steady improvement in the numbers for all three calendar years, i.e. ’25, ’26, and ’27.
The earnings multiples on the above estimates:
- ’27: 20x
- ’26: 22x
- ’25: 25x
The SP 500 earnings yield bounced a little this week, despite the rally as the $10 increase in the FFQE improved the SP 500 earnings yield from 4.26% last week to 4.37% this week. While I’d like to see the SP 500 earnings yield higher – at least 4.75% to 5% area – the persistent and healthy increases in the SP 500 earnings is providing a floor for the SP 500.
It’s hard to say when that changes as 2026’s EPS estimate is still moving higher, as the spreadsheet above shows.
Summary / conclusion: Most folks wouldn’t guess that investors are looking at a potential $300 EPS estimate for late 2026. Rather then re-write War & Peace, this post from last week on how Q3 ’25 SP 500 EPS by sector have trended (here) still applies.
This coming week’s companies that report hold no interest with the possible exception of Pepsi (PEP), which is getting interest from activists. Coca-Cola (KO) spun-off it’s bottling operations last decade and since January 1 ’15 and January 1 ’20, KO has underperformed the SP 500 by half over those two time periods.
None of this is advice or a recommendation, but only an opinion. Past performance is no guarantee of future results. All SP 500 EPS estimates are sourced from LSEG.com.
Thanks for reading.