Healthy Earnings Trend in the S&P 500
It’s clear that earnings in the S&P 500 continue to be robust, as shown by the weekly trend in the quarterly EPS and revenue growth rates. Let’s take a closer look at the data outlined in the Excel spreadsheet below.
In the bordered boxes, we can see a noticeable increase in Q3 ’24 S&P 500 EPS growth, as expected EPS growth for Q3 ’24 hit a low point during the week of October 18th. The revenue growth is also impressive, with a 1.3% increase over the 4% revenue growth estimate.
S&P 500 Data:
- The S&P 500 forward 4-quarter estimate dropped to $263.01 last week from the previous week’s $263.39 and the start of October quarter’s $266.66.
- The PE ratio closed this week at 22.3x, down from 22.7x last week after a 2% decrease in the S&P 500.
- The 10-year Treasury yield has risen for 8 consecutive weeks, ending this week at 4.43%.
- The S&P 500’s earnings yield finished the week at 4.48%, similar to the beginning of the quarter.
- The average credit spread for the high-yield credit market tightened for the 10th straight week, ending at +264 (the equivalent Treasury).
- The S&P 500’s EPS “upside surprise” improved to 7.7% this week.
Nvidia:
Nvidia (NASDAQ:) is set to report its financial results after Wednesday night’s close on November 20th, and excitement is building around this event.
EPS Estimate Revisions:
There have been significant revisions in both EPS and revenue estimates for Nvidia over the past 18 months.
Revenue Estimate Revisions:
Expected revenue estimates for Nvidia in 2028 have more than doubled since June ’23, showcasing strong growth projections.
Walmart (NYSE:) is also reporting its financial results on Tuesday morning, November 19th, 2024, and the company’s performance is worth keeping an eye on.
Conclusion:
While the EPS and revenue estimate trends for Nvidia look positive, it’s essential to monitor any changes in the market. As an experienced investor, I have made strategic decisions to optimize our positions and will continue to evaluate opportunities in the semiconductor sector.
With the latest retail sales data and Walmart’s upcoming financial results, it’s evident that the consumer market remains robust. Walmart’s innovative approach to AI and data utilization is driving its growth, positioning the company for success in fiscal ’25.
Disclaimer: This content is for informational purposes only and should not be considered financial advice. Past performance is not indicative of future results, and investing involves risks. Readers should assess their risk tolerance and make informed investment decisions accordingly.
Thank you for reading and stay tuned for more updates.