{"id":6517,"date":"2016-12-04T16:31:42","date_gmt":"2016-12-04T16:31:42","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=6517"},"modified":"2016-12-04T16:31:42","modified_gmt":"2016-12-04T16:31:42","slug":"sp-500-weekly-earnings-update-q4-16-sp-500-earnings-less-negative","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=6517","title":{"rendered":"SP 500 Weekly Earnings Update: Q4 &#8217;16 SP 500 Earnings &#8220;Less Negative&#8221;"},"content":{"rendered":"<p><em><strong>Thomson Reuters (by the numbers):<\/strong><\/em><\/p>\n<ul>\n<li><em><strong>Forward 4-quarter estimate:<\/strong><\/em> $128.61 vs last week&#8217;s $128.56 and another sequential revision higher, which is unusual<\/li>\n<li><em><strong>P.E ratio:<\/strong><\/em> 17(x)<\/li>\n<li><em><strong>PEG ratio:<\/strong><\/em> 4(x)<\/li>\n<li><em><strong>SP 500 earnings yield:<\/strong><\/em> 5.87% up from last week&#8217;s 5.81%<\/li>\n<li><em><strong>Year-over-year growth of the forward estimate:<\/strong><\/em> 4.15%, vs last week&#8217;s 4.03% and nearing the high&#8217;s from January &#8217;15<\/li>\n<\/ul>\n<p>The stat of the week is from Factset, as John Butters notes that the typical downward revisions to the 4th quarter &#8217;16 growth rate that we typically see at this point in the 3rd quarter is &#8220;less negative&#8221; than historical data suggests.<\/p>\n<p>I&#8217;ve written about this changing pattern in the past, but here is the Factset data:<\/p>\n<ul>\n<li><em><strong>Q4 &#8217;16 actual drop:<\/strong><\/em> -2%<\/li>\n<li><em><strong>4-quarter average:<\/strong><\/em> -3.8%<\/li>\n<li><em><strong>20 quarter average:<\/strong><\/em> -3.4%<\/li>\n<li><strong><em>40 quarter average:<\/em><\/strong>-3.9%<\/li>\n<\/ul>\n<p>The &#8220;forward 4-quarter&#8221; estimate has risen for three weeks in row sequentially, which is also a subtle but important sign of underlying strength in forward earnings.<\/p>\n<p>Energy will be a positive contributor to SP 500 earnings in Q4 &#8217;16, for the first time in almost 8 quarters.<\/p>\n<p>On Friday, December 2nd, the Technology weakness was written about<a href=\"https:\/\/fundamentalis.com\/?p=6511\">\u00a0here<\/a>. The disparity between the &#8220;Growth&#8221; and &#8220;Value&#8221; style boxes is expanding rapidly. I&#8217;ll have more on the tech sector&#8217;s weakness and Growth vs Value this coming week.<\/p>\n<p>Q4 &#8217;16 earnings will become less relevant into early 2017, particularly after the inauguration of President-elect Trump as we see and hear what Congress has in store in terms of tax law changes. No question the legislative agenda will be very &#8220;pro-business&#8221;.<\/p>\n<p>The SP 500 earnings yield continues to remain elevated and the y\/y growth in the forward estimate continues to grow, both bode well for forward stock returns.<\/p>\n<p>Thanks for reading.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Thomson Reuters (by the numbers): Forward 4-quarter estimate: $128.61 vs last week&#8217;s $128.56 and another sequential revision higher, which is&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":[92,162,91],"tags":[],"class_list":["post-6517","post","type-post","status-publish","format-standard","hentry","category-fwd-4-qtr-growth-rate-sp-500","category-sp-500-earnings-yield","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\/6517","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=6517"}],"version-history":[{"count":6,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/6517\/revisions"}],"predecessor-version":[{"id":6523,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/6517\/revisions\/6523"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=6517"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=6517"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=6517"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}