Weekly Earnings Update: Forward Growth Rate Continues to Expand

Thomson Reuters data (by the numbers): 

  • Forward 4-quarter growth rate: $128.54 vs last week’s $128.51. Again, unusual to see sequential increases. The typical pattern at this point in quarter is for steady erosion.
  • P.E ratio: 17.5(x)
  • PEG ratio: 3.89(x)
  • SP 500 earnings yield: 5.69% vs last week’s 5.69%
  • Year-over-year growth in forward 4-qtr growth rate: +4.51% vs last week’s +4.15%

The “tale of the tape” (or data) this week continues to be that the “y/y growth in the forward 4-quarter growth rate” continues to grow.

In other words, as of this past week, the rate of growth is getting faster.

Here is the recent trend in the y/y forward 4-quarter growth rate:

  • 12/16/16: +4.51%
  • 12/2/16: +4.15%
  • 11/18/16: +3.80%
  • 10/28/16: +3.70%
  • 10/14/16: +3.26%
  • 9/30/16: -1.18%

This is the first time in over two years the rate of change in the forward estimate is and has remained positive and shown steady improvement for any length of time.

This is another factor that should be supportive of our 2017 SP 500 forecast posted yesterday.

Thank you for reading.



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