{"id":10772,"date":"2020-10-09T16:14:16","date_gmt":"2020-10-09T22:14:16","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=10772"},"modified":"2020-10-09T16:14:16","modified_gmt":"2020-10-09T22:14:16","slug":"weekly-sp-500-earnings-update-sequential-increases-in-the-forward-estimate-continue","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=10772","title":{"rendered":"Weekly SP 500 Earnings Update: Sequential Increases in the Forward Estimate Continue"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">The forward 4-quarter estimate for the SP 500 returned to its familiar pattern of sequentially moving higher this week, printing $156.08 vs $155.98 last week. A small increase &#8211; yes &#8211; but still sequential improvement <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Here is a picture of what the spreadsheet looks like tracking the IBES data by Refinitiv: <\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"81\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwd4qtrest10920-1024x81.png\" alt=\"\" class=\"wp-image-10774\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwd4qtrest10920-1024x81.png 1024w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwd4qtrest10920-300x24.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwd4qtrest10920-768x61.png 768w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwd4qtrest10920.png 1486w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption>click to open \/ enhance<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">What fascinates me is that since July 1, only two weeks of the last 16 have seen sequential declines in the forward estimate. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Geeky data &#8220;stuff&#8221; but numbers tell a story. <\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>The forward 4-qtr estimate improved sequentially to $156.08 from last week&#8217;s $155.98;<\/li><li>The forward PE is 22x;<\/li><li>The SP 500 forward earnings yield fell a little bit this week to 4.49% from 4.64% last week;<\/li><li>The &#8220;average&#8221; expected calendar 2020 and 2021 SP 500 EPS growth fell to 3.5% this week, from a long string of 4% prints. Let&#8217;s see what the next few weeks hold;<\/li><li>The &#8220;expected&#8221; 2021 EPS of $166.22 is still above the 2019 actual EPS of $162.93;<\/li><\/ul>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>SP 500 Forward earnings curve: <\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"378\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwdEPScurve10920-1024x378.png\" alt=\"\" class=\"wp-image-10777\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwdEPScurve10920-1024x378.png 1024w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwdEPScurve10920-300x111.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwdEPScurve10920-768x284.png 768w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwdEPScurve10920-1536x567.png 1536w, https:\/\/fundamentalis.com\/wp-content\/uploads\/SP500fwdEPScurve10920.png 1624w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption>click to open \/ enhance<\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">This week, note the &#8220;4-week rate of change&#8221;. The sequential increases continued this week, which is always a plus. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Looking at Next 4 Quarter&#8217;s Earnings and Rev Growth: <\/strong><\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"842\" height=\"721\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/q3q420SP500epsrevgro10920.png\" alt=\"\" class=\"wp-image-10778\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/q3q420SP500epsrevgro10920.png 842w, https:\/\/fundamentalis.com\/wp-content\/uploads\/q3q420SP500epsrevgro10920-300x257.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/q3q420SP500epsrevgro10920-768x658.png 768w\" sizes=\"auto, (max-width: 842px) 100vw, 842px\" \/><figcaption>click to open \/ enhance <\/figcaption><\/figure>\n\n\n\n<p class=\"wp-block-paragraph\">Showing the same data from various perspectives helps the reader see the y\/y change in EPS and revenue growth for the SP 500. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Sector data will follow tomorrow. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">EPS growth for Q3 &#8217;20, Q4 &#8217;20 and Q1 &#8217;21 continue to slowly improve. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Let&#8217;s see what this table looks like next week after 15 financials report and readers can see what consumer and commercial credit losses look like. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This blog will have more on the Financial sector over the weekend. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Summary \/ conclusion: <\/strong>This weekly overview on the SP 500 numbers &#8211; both expected EPS and revenue growth &#8211; shows that the positive trends remain in place, but analysts are still somewhat sheepish to raise numbers in advance of seeing prints. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The financial sector will likely trade off expected vs actual credit losses. Tom Brown of Bankstocks.com thinks that credit losses will be &#8220;BTE&#8221; or better-than-expected&#8221;. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Walgreens reports next week too. One of my all-time favorite stocks which we haven&#8217;t owned for years, thanks to the brick-and-mortar model and reimbursement pressure. An earnings preview is coming over on Seeking Alpha before the Thursday morning report. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It&#8217;s all about banks, brokers and money managers reporting next week. More will be forthcoming over the long weekend. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Thanks for reading. <\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The forward 4-quarter estimate for the SP 500 returned to its familiar pattern of sequentially moving higher this week, printing&hellip;<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1,91],"tags":[],"class_list":["post-10772","post","type-post","status-publish","format-standard","hentry","category-uncategorized","category-weekly-earnings-update"],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/10772","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=10772"}],"version-history":[{"count":5,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/10772\/revisions"}],"predecessor-version":[{"id":10780,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/10772\/revisions\/10780"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=10772"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=10772"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=10772"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}