Per Thomson Reuters’ “This Week in Earnings” the forward 4-quarter earnings estimate for the SP 500 fell this week to $126.64 from last week’s $126.77.<\/p>\n
P.e ratio:<\/strong><\/em> 16(x)<\/p>\n PEG ratio:<\/strong><\/em> 2.14(x)<\/p>\n Earnings yield:<\/strong> <\/em>6.21%<\/p>\n Year-over-year (y\/y) growth rate of the forward estimate:<\/strong><\/em> +7.54%, <\/em>versus last week’s +7.63% or a 9 basis point drop.<\/p>\n Analysis \/ commentary:<\/strong> <\/em>the one metric at caught my eye this morning as I read through the weekend earnings research at Saturday breakfast, is that the expected earnings growth for q4 ’14 for the SP 500 as a whole was 7.3% as of Friday’s “This Week in Earnings” report, versus 7.6% last week, which tells me that the Energy and Basic Materials negative earnings revisions could be coming to an end, at least for now.<\/p>\n With 450 of the SP 500 having reported q3 ’14 earnings, the results have actually been pretty positive: actual earnings growth for q3 ’14 per Thomson Reuters is +9.8%, but that includes what is widely-regarded as the last good quarters of Energy and Basic Material’s earnings growth, which was +10.4% for Energy, and +20.7% for Basic Materials (compared to the -7.9% and -0.3% for q4 ’14, respectively.)<\/p>\n Here is how the 10 sectors of the SP 500 expected q4 ’14 earnings growth have changed in the last week:<\/strong> <\/em><\/p>\n Consumer Disc: +8.8%, +9.6% (80 basis point decline)<\/p>\n Consumer Spls: +0.9%, +1.4% ( 50 basis point decline)<\/p>\n Energy: -7.9%, -6.9% (100 basis point decline)<\/p>\n Financl’s: +8.6%, +8.6% (no change, and somewhat puzzling given the charges that are circulating regarding the forex scandal);<\/p>\n Hlth Care: +18.1%, +17.9% ( another weekly increase)<\/p>\n Industrials: +11.2%, +11.2% (no change, should be beneficiary of falling crude prices)<\/p>\n Basic Materials: -0.3%, +0.1% (pretty dramatic change from q3 ’14’s +20% growth)<\/p>\n Technology: +8.5%, +8.6%<\/p>\n Telco: +19.6, +19.9%<\/p>\n Utilities: +9.8%, +9.3% (another increase)<\/p>\n SP 500: +7.3%, +7.6% (30 basis point decline)<\/strong> <\/em><\/p>\n My own opinion is that we are starting to see estimates stabilize for q4 ’14 after the Energy and Basic Materials shock.<\/p>\n 2015’s expected SP 500 earnings growth fell from +10.3 to +10.2% in the last week, not really worth mentioning, but we keep track of the changes in expected earnings growth across multiple timeframes.<\/p>\n It is just\u00a0my opinion, but SP 500 earnings continue to be\u00a0a bright spot: despite ugly revisions for Energy and Basic Mat for the 4th quarter, consensus estimates are still looking for +7.3% growth in q4 ’14. That will surely come down before q4 ’14 earnings start to get reported in January, ’15, but we should end up with a +5% growth rate just as earnings start. That is a plus, particularly with the pressure on the Energy sector.<\/p>\n