S&P500 Earnings Trends – March 2023

S&P500 earnings trends and estimates are a notably important topic, for a variety of reasons, at this point in time.

FactSet publishes a report titled “Earnings Insight” that contains a variety of information including the trends and expectations of S&P500 earnings.

For reference purposes, here are two charts as seen in the “Earnings Insight” report of March 16, 2023:

from page 27:

(click on charts to enlarge images)

S&P500 EPS

from page 28:

S&P500 EPS 2013-2024

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

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ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.

S&P500 EPS Estimates For 2022 – 2024 As Of March 10, 2023

As many are aware, Refinitiv publishes earnings estimates for the S&P500.  

The following estimates are from Exhibit 24 of the “S&P500 Earnings Scorecard” (pdf) of March 10, 2023, and represent an aggregation of individual S&P500 component “bottom up” analyst forecasts.  For reference, the Year 2014 value is $118.78/share; the Year 2015 value is $117.46/share; the Year 2016 value is $118.10/share; the Year 2017 value is $132.00/share; the Year 2018 value is $161.93/share; the Year 2019 value is $162.93/share; the Year 2020 value is $139.72/share; and the year 2021 value is $208.12:

Year 2022 estimate:

$218.74/share

Year 2023 estimate:

$221.82/share

Year 2024 estimate:

$248.63/share

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

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ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability

S&P500 EPS Forecasts From Standard & Poor’s March 9, 2023

As many are aware, Standard & Poor’s publishes earnings estimates for the S&P500.  

For reference purposes, the most current estimates are reflected below, and are as of March 9, 2023:

Year 2022 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $196.10/share

-From a “bottom up” perspective, “as reported” earnings of $172.74/share

Year 2023 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $219.46/share

-From a “bottom up” perspective, “as reported” earnings of $201.18/share

Year 2024 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $246.09/share

-From a “bottom up” perspective, “as reported” earnings of $227.89/share

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability

Short- And Longer-Term Business Inflation Expectations

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the March 2023 BIE Survey dated March 15, 2023 (involving 167 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations increased significantly to 3.1 percent, on average.
  • Current economic environment: Sales levels “compared to normal” decreased over the month, and profit margins “compared to normal” remained unchanged over the month. Year-over-year unit cost growth increased significantly to 3.8 percent, on average.
  • Quarterly question: Firms’ long-term (per year, over the next five to 10 years) inflation expectations remain unchanged at 3.1 percent, on average.
  • Special question: Firms were asked about the percent of their operating costs attributable to energy usage structures. They were also asked about energy cost increases and the impact on their firms if energy costs increase 50 percent more than their expectations.. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.

Firms’ Year-Ahead CPI Inflation Forecast

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the February 2023 BIE Survey dated February 15, 2023 (involving 171 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations remain relatively unchanged at 2.9 percent, on average.
  • Current economic environment: Sales levels “compared to normal” increased but remain negative. Firms’ profit margins “compared to normal” decreased. Year-over-year unit cost growth significantly decreased at 3.5 percent, on average.
  • Quarterly question: Approximately 82 percent of firms expect both labor and nonlabor costs to place upward influence on prices. About 51 percent of firms expect sales levels to exert little or no influence on prices over the next 12 months. Approximately 50 percent of firms expect margin adjustment to have little or no influence on prices over the next 12 months.
  • Special question: Firms were asked about realized aggregate inflation in the United States over the last 12 months as measured by the CPI. They were also asked about their expected inflation over the next 12 months in the United States as measured by the CPI. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.