S&P 500 Earnings: Little Has Changed In Terms Of S&P 500 EPS Trends

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While the Industrial-related S&P 500 sectors are showing signs of a better 2020 (and this could change by early 2020), the overall S&P 500 EPS trends remain little changed as we head into Q4’19.

(This S&P 500 earnings update is being published later than usual, thanks to attending the WealthStack conference in Scottsdale, Arizona, this past weekend and through yesterday. Barry Ritholtz and Josh Brown of Ritholtz Wealth Management co-sponsored the event (with Inside ETFs), and like a lot of Ritholtz Wealth Management does, the conference was very well done in terms of content and venue and will likely only improve with time.)

  • Fwd 4-qtr. est.: $171.55 vs. last week’s $171.68
  • TTM est.: $164.44 vs. $164.39 last week
  • FWD P/E: 17.4x
  • TTM P/E: 18.1x
  • PEG (fwd.): 12x
  • PEG TTM: 4x
  • S&P 500 earnings yield: 5.76% vs. last week’s 5.87%
  • Year-over-year growth fwd. est.: +1.45% vs. +1.51%
  • Year-over-year growth TTM est.: +4.32% vs. last week’s +4.43%

Summary/ Conclusion: Even though the bottom-up estimates for the S&P 500 are still looking for 2020 S&P 500 EPS growth of 11%, the “forward 4-quarter” EPS est.” for the S&P 500 is only growing just a little over 1% versus the forward estimate from 52 weeks prior, hence there is little reason for the S&P 500 P/E to expand.

The year-over-year growth of the trailing-12 month EPS estimate is a little higher at 4%, and that includes the current 2nd-quarter earnings results each week, which will finish in two weeks.

Keep an eye on that 2020 S&P EPS growth number: when this pattern that has been in evidence of “expected growth” stability of 11-12%, it usually portends good things for the stock market.

Thanks for reading.

Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.