Profitability Issues

S&P500 EPS Forecasts From Standard & Poor’s January 12, 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 January 12, 2023:

Year 2022 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $199.76/share

-From a “bottom up” perspective, “as reported” earnings of $180.30/share

Year 2023 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $225.35/share

-From a “bottom up” perspective, “as reported” earnings of $203.53/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

Firms’ Inflation Forecasts And Business Environment Responses

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 January 2023 BIE Survey dated January 11, 2023 (involving 152 firms responding):

Inflation expectations: Firms’ year-ahead inflation expectations remain relatively unchanged at 3.0 percent, on average.
Current economic environment: “Compared to normal,” sales levels remained relatively unchanged. However, profit margins “compared to normal” significantly decreased. Year-over-year unit cost growth remained relatively unchanged at 3.7 percent, on average.
Quarterly question: Firms’ sales gaps (percentage below “normal” unit sales levels) significantly decreased to 4.6 percent below normal. Small, medium, and large firms’ unit sales gaps decreased significantly.
Special question: Firms were asked about their most pressing concerns. 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.

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S&P500 Earnings Trends – December 2022

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 December 15, 2022:

from page 30:

(click on charts to enlarge images)

from page 31:

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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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S&P500 EPS Estimates For 2022 – 2024 As Of December 9, 2022

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 December 9, 2022, 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:

$220.40/share

Year 2023 estimate:

$231.14/share

Year 2024 estimate:

$254.29/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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S&P500 EPS Forecasts From Standard & Poor’s December 15, 2022

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 December 15, 2022:

Year 2022 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $200.49/share

-From a “bottom up” perspective, “as reported” earnings of $181.14/share

Year 2023 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $227.16/share

-From a “bottom up” perspective, “as reported” earnings of $203.75/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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