{"id":7838,"date":"2018-06-09T17:31:22","date_gmt":"2018-06-09T17:31:22","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=7838"},"modified":"2018-06-10T12:23:12","modified_gmt":"2018-06-10T12:23:12","slug":"a-peek-at-q2-18-expected-earnings-and-a-closer-look-at-the-technology-sector","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=7838","title":{"rendered":"A Peek at Q2 &#8217;18 Expected Earnings and a Closer Look at the Technology Sector"},"content":{"rendered":"<figure id=\"attachment_7839\" aria-describedby=\"caption-attachment-7839\" style=\"width: 300px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/fundamentalis.com\/?attachment_id=7839\" rel=\"attachment wp-att-7839\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-7839\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/Q218sectorEPSgrowth6918-300x155.png\" alt=\"\" width=\"300\" height=\"155\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/Q218sectorEPSgrowth6918-300x155.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/Q218sectorEPSgrowth6918.png 605w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><figcaption id=\"caption-attachment-7839\" class=\"wp-caption-text\">Click to enhance<\/figcaption><\/figure>\n<p>&nbsp;<\/p>\n<p>The above was cut-and-pasted from Friday, June 8th&#8217;s &#8220;This Week in Earnings&#8221; and the table shows how SP 500 expected earnings growth has tracked by sector since Jan 1 &#8217;18. Q2 &#8217;18 will obviously benefit from tax reform and the reduction in corporate tax rates, but SP 500 revenue growth for Q2 &#8217;18 is still expected at a healthy 8% rate.<\/p>\n<p>&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;<\/p>\n<p><em><strong>The weekly SP 500 earnings data:<\/strong><\/em><\/p>\n<ul>\n<li><em><strong>Fwd 4-qtr est:<\/strong><\/em> $163.82, vs last week&#8217;s $162.84<\/li>\n<li><em><strong>P.E ratio:<\/strong> <\/em>17x<\/li>\n<li><em><strong>PEG ratio:<\/strong> <\/em>0.79x<\/li>\n<li><em><strong>SP 500 earnings yield:<\/strong><\/em> +5.89% vs last week&#8217;s +5.99%<\/li>\n<li><em><strong>Year-over-year growth of fwd est: <\/strong><\/em>+21.5% vs ;last week&#8217;s +21.5%<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<p>A quick look at the Tech sector&#8217;s expected forward earnings growth:<\/p>\n<ul>\n<li><em><strong>Q1 &#8217;19:<\/strong> <\/em>+2.6%, vs +9.7% (est)<\/li>\n<li><em><strong>Q4 &#8217;18:<\/strong><\/em>+14.9% vs +13.9% (est)<\/li>\n<li><em><strong>Q3 &#8217;18:<\/strong><\/em> +16.5%, vs +15.4% (est)<\/li>\n<li><em><strong>Q2 &#8217;18:<\/strong><\/em> +24.2% vs +22% (est)<\/li>\n<li><em><strong>Q1 &#8217;18:<\/strong><\/em> +36.4% vs 23.4% (actual)<\/li>\n<\/ul>\n<p>&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8212;&#8211;<\/p>\n<p>The first column of numbers is actual \/ expected growth as of June 8, 2018, and the second column is as of April 1 &#8217;18.<\/p>\n<p>With Q1 &#8217;18 earnings practically complete, readers can see how strong actual tech earnings were versus the expectations as of April &#8217;18.<\/p>\n<p>Will Q2 &#8217;18 be as strong ? So much depends on Apple. The fact that investors are seeing upward revisions to Tech earnings for Q2 &#8217;18 through Q4 &#8217;18 is comforting.<\/p>\n<p>However look at Q1 &#8217;19 and how that estimate&#8217;s growth rate has fallen. Should we be worried ? Hard to say &#8211; if there is a problem with Tech earnings beginning in Q1 &#8217;19, then the stocks should start to discount that issue shortly.<\/p>\n<figure id=\"attachment_7841\" aria-describedby=\"caption-attachment-7841\" style=\"width: 300px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/fundamentalis.com\/?attachment_id=7841\" rel=\"attachment wp-att-7841\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-7841\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/Nasdaqmorrow6718-300x275.png\" alt=\"\" width=\"300\" height=\"275\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/Nasdaqmorrow6718-300x275.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/Nasdaqmorrow6718.png 555w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><figcaption id=\"caption-attachment-7841\" class=\"wp-caption-text\">Click to enhance<\/figcaption><\/figure>\n<p>&nbsp;<\/p>\n<p>Here is a chart cut-and-pasted from Gary Morrow&#8217;s work as June 7, 2018 where Gary indicates a potential double-top for the Nasdaq on the chart. (Note the word, &#8220;potential&#8221; &#8211; the chart has to resolve itself.)<\/p>\n<p>The Nasdaq is worth watching this coming week.<\/p>\n<p>For Q1 &#8217;19 so far, only the Energy and Real Estate sectors have seen upward revisions to the expected Q1 &#8217;19 data as of Friday. Still it&#8217;s a little early. We&#8217;ll know more by late July &#8217;18.<\/p>\n<p>The FOMC announcement is also coming this week as well as European and Japan Central Bank pronouncements.<\/p>\n<p>Big week ahead for &#8220;macro&#8221; monetary policy headlines.<\/p>\n<p>Thanks for reading.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; The above was cut-and-pasted from Friday, June 8th&#8217;s &#8220;This Week in Earnings&#8221; and the table shows how SP 500&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":[123,91],"tags":[],"class_list":["post-7838","post","type-post","status-publish","format-standard","hentry","category-technology","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\/7838","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=7838"}],"version-history":[{"count":5,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/7838\/revisions"}],"predecessor-version":[{"id":7845,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/7838\/revisions\/7845"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=7838"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=7838"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=7838"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}