In last weekend’s post on S&P 500 earnings, we looked at the weekly rate of change in the SP 500 2019 EPS estimate.
Here is the same data looking at the year-over-year change in the 2019 S&P 500 EPS estimate:
- 8/14/18: $178.85 +12.5% expected y/y growth
- 8/17/18: $178.58 +12.1% expected y/y growth
- 7/13/18: $177.16 +10.7% expected y/y growth
- 6/15/18: $176.94 +9.9% expected y/y growth
- 5/13/18: $176.61 +9.1% expected y/y growth
(Source: Thomson Reuters IBES earnings data, tracking the data is my own work)
To provide some color to the above, the 52-week change between the current S&P 500 forward EPS estimate and the estimate from 52 weeks ago, continues to expect gradually faster growth.
Take this data with a small grain of salt though. We will get the first peek at 2019 S&P 500 guidance from some companies with October earnings, but the majority of full-year 2019 earnings guidance will come in January – February of ’19.
Readers need to know that in 2019 the S&P 500 will be lapping the reduction to a 20% corporate income tax rate, which we estimated here as accounting for roughly half of the 2018’s +20% EPS growth rate.
Right now, 2019 S&P 500 earnings estimates are trending the right way, and the fact that there is little “exuberance” over this is indicative of the post-2008 world.
Market valuation will always be used by both market bulls and bears – keep the faith – my own opinion is that this post-2008 SP 500 and US stock market is very healthy.