{"id":8890,"date":"2019-04-19T18:55:02","date_gmt":"2019-04-19T18:55:02","guid":{"rendered":"https:\/\/fundamentalis.com\/?p=8890"},"modified":"2019-04-27T20:07:49","modified_gmt":"2019-04-27T20:07:49","slug":"sp-500-earnings-update-is-the-sp-500-earnings-turn-beginning","status":"publish","type":"post","link":"https:\/\/fundamentalis.com\/?p=8890","title":{"rendered":"SP 500 Earnings Update: Is the SP 500 Earnings Turn Beginning ?"},"content":{"rendered":"<p>A focus on the Health Care sector and historical revenue and earnings growth will come this weekend. The sector has been absolutely crushed the last few weeks.<\/p>\n<p><em><strong>SP 500 Earnings (by the numbers):\u00a0<\/strong><\/em>Source: I\/B\/E\/S by Refinitiv<\/p>\n<ul>\n<li><em><strong>Fwd 4-qtr est:<\/strong><\/em> $172.14 vs last week&#8217;s $173.14<\/li>\n<li><em><strong>PE ratio:<\/strong><\/em> 16.9x<\/li>\n<li><em><strong>PEG ratio:<\/strong><\/em> 2.76x<\/li>\n<li><em><strong>SP 500 earnings yield:<\/strong><\/em> 5.95% vs last week&#8217;s 5.93%<\/li>\n<li><em><strong>Year-over-year growth of fwd est:<\/strong><\/em> +6.17% vs last week&#8217;s 6.37%<\/li>\n<\/ul>\n<p>(One clarification for readers: the &#8220;forward 4-quarter estimate&#8221; is now Q2 &#8217;19 through Q1 &#8217;20 as defined by IBES by Refinitiv. The 4-quarter trailing actual is now q2 &#8217;18 through Q1 &#8217;19. The calendar &#8217;18 four-quarter trailing actual earnings couldn&#8217;t be used since it would leave a gap between the 4-quarter forward, vs 4-quarter trailing. Hope this makes sense.)<\/p>\n<p>Is the Turn Starting ?<\/p>\n<figure id=\"attachment_8892\" aria-describedby=\"caption-attachment-8892\" style=\"width: 300px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/fundamentalis.com\/?attachment_id=8892\" rel=\"attachment wp-att-8892\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-8892\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/IBESEPSgraph41919-300x234.png\" alt=\"\" width=\"300\" height=\"234\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/IBESEPSgraph41919-300x234.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/IBESEPSgraph41919.png 456w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><figcaption id=\"caption-attachment-8892\" class=\"wp-caption-text\">Click to enhance \/ enlarge<\/figcaption><\/figure>\n<p>&nbsp;<\/p>\n<p>This graphical portrayal of the total dollar earnings tracked by IBES is usually on page 1 of &#8220;This Week in Earnings&#8221;.<\/p>\n<p><em><strong>Financials Had a Good Week:\u00a0<\/strong><\/em><\/p>\n<ul>\n<li><em><strong>Schwab:<\/strong><\/em> +2.91%<\/li>\n<li><em><strong>JP Morgan:<\/strong><\/em> +6.81%<\/li>\n<li><em><strong>XLF:<\/strong><\/em> +2.59%<\/li>\n<li><em><strong>KRE<\/strong><\/em>: +1.06%<\/li>\n<li><em><strong>CME:<\/strong><\/em> +3.41%<\/li>\n<li><em><strong>GS:<\/strong><\/em>\u00a0 +1.52%<\/li>\n<li><em><strong>SP 500:<\/strong><\/em> +0.58%<\/li>\n<\/ul>\n<p>Nice bounce in Financials this past week, as the sector narrowed the under-performance gap with the SP 500. With the 10-year Treasury yield now above 2.55% as the long end of the Treasury curve rises in yield, the fears of yield curve inversion should dissipate.<\/p>\n<p>This was a <a href=\"https:\/\/fundamentalis.com\/?p=8883\">timely blog post<\/a> from last week.<\/p>\n<p><em><strong>Summary \/ conclusion: <\/strong><\/em>155 SP 500 companies report their March &#8217;19 quarterly earnings in the coming week, thus by the end of next week, almost half the SP 500 will have reported quarterly results. Using the standard &#8220;upside surprise&#8221; factor to quarterly earnings, Q1 &#8217;19 SP 500 earnings should end the reporting period with actual y\/y growth around 3% &#8211; 4%.<\/p>\n<p>The problem is that there is still little upside momentum in the expected growth rates for the &#8220;out&#8221; quarters like Q2, Q3 and Q4, &#8217;19.<\/p>\n<p>Here are the current worries to the US stock market today:<\/p>\n<p>1.) low VIX;<\/p>\n<p>2.) Seems like there is little enthusiasm for the SP 500 to take out the Sept. 1&#8217;8 highs at 2,940 &#8211; 2,942;<\/p>\n<p>3.) The SP 500 is overbought;<\/p>\n<p>BUT earnings estimate revisions are still getting &#8220;less worse&#8221;:<\/p>\n<figure id=\"attachment_8897\" aria-describedby=\"caption-attachment-8897\" style=\"width: 300px\" class=\"wp-caption aligncenter\"><a href=\"https:\/\/fundamentalis.com\/?attachment_id=8897\" rel=\"attachment wp-att-8897\"><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-8897\" src=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/EPSrevisiontrends41919-300x52.png\" alt=\"\" width=\"300\" height=\"52\" srcset=\"https:\/\/fundamentalis.com\/wp-content\/uploads\/EPSrevisiontrends41919-300x52.png 300w, https:\/\/fundamentalis.com\/wp-content\/uploads\/EPSrevisiontrends41919-768x133.png 768w, https:\/\/fundamentalis.com\/wp-content\/uploads\/EPSrevisiontrends41919-1024x177.png 1024w, https:\/\/fundamentalis.com\/wp-content\/uploads\/EPSrevisiontrends41919.png 1045w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><figcaption id=\"caption-attachment-8897\" class=\"wp-caption-text\">click to enhance \/ enlarge<\/figcaption><\/figure>\n<p>The far right column begins on February 1, 2019. The near column is as of 4\/19\/19.<\/p>\n<p>Whatever the problem within the SP 500 today, I don&#8217;t think it is earnings-related, That was the last 2 quarters.<\/p>\n<p>Thanks for reading.<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>A focus on the Health Care sector and historical revenue and earnings growth will come this weekend. The sector has&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":[84,53,1,206],"tags":[],"class_list":["post-8890","post","type-post","status-publish","format-standard","hentry","category-financial-sector","category-financials","category-uncategorized","category-xlf"],"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\/8890","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=8890"}],"version-history":[{"count":9,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/8890\/revisions"}],"predecessor-version":[{"id":8933,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=\/wp\/v2\/posts\/8890\/revisions\/8933"}],"wp:attachment":[{"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8890"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8890"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/fundamentalis.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8890"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}