Category Archives: earnings

Spring 2021 Snapshot of Expected Future S&P 500 Earnings

Every three months, we take a snapshot of the expectations for future earnings in the S&P 500 (Index: SPX) at approximately the midpoint of the current quarter, shortly after most U.S. firms have announced their previous quarter's earnings.

Standard and Poor's newest forecast projects a full earnings recovery for the index' earnings per share by June 2021. In addition, S&P is projecting much more robust earnings growth than they were three months ago.

Forecasts for S&P 500 Trailing Twelve Month Earnings per Share, December 2017-December 2022, Snapshot on 12 May 2021

The more robust earnings growth can best be seen in the trailing year earnings per share projected for December 2021. Three months ago, S&P anticipated that figure would be $153.86 per share. Its 12 May 2021 projection indicates the year end earnings figure will reach $174.87 per share.

If that outcome is realized, it would put the S&P 500's trailing twelve month earnings per share nearly back on the trajectory that S&P projected back in February 2020, before the onset of the coronavirus pandemic recession hammered corporate earnings in the U.S.

Reference

Silverblatt, Howard. Standard & Poor. S&P 500 Earnings and Estimates. [Excel Spreadsheet]. 12 May 2021. Accessed 14 May 2021. (As a bonus for this edition, if you follow the link to the spreadsheet before his next update, you'll find Howard's photo celebrating the arrival of springtime in New York City.)

Visualizing Historic Yields for the S&P 500

Ever since we put the S&P 500 at your fingertips, we've explored a lot of different ways to visualize that treasure trove of U.S. stock market data as represented by the S&P 500 (Index: SPX).

But until today, we've never presented the historic yields for the index. The following chart fills that gap in our visualizations of the S&P 500's data, showing the index' monthly trailing year earnings yield and its trailing year dividend yield from January 1871 through March 2021:

Historic Yields for the S&P 500, January 1871 - March 2021

As a general rule, dividends have represented anywhere from half to two-thirds of the earnings of S&P 500 companies.

Both the S&P 500's earnings and dividend yields have fallen over time, with the most significant downward shift occurring in the 1990s. This shift coincides with the arrival of the Dot Com Bubble and the modern era of the Federal Reserve's monetary policies, which have set U.S. interest rates on a long term falling trend.

Those long term trends are punctuated by periodic spikes in the data. Spikes in either data series tend to indicate crashing stock prices rather than surging earnings or dividends.

If you would like to sample the raw data behind these values, our S&P 500 At Your Fingertips tool can provide you with the values of the S&P 500 or its predecessor indices, their trailing year earnings per share, and their trailing year dividends per share for any month from January 1871 through the last month.

Winter 2021 Snapshot of Expected Future S&P 500 Earnings

Every three months, we take a snapshot of the expectations for future earnings in the S&P 500 (Index: SPX) at approximately the midpoint of the current quarter, shortly after most U.S. firms have announced their previous quarter's earnings.

The latest forecast for S&P 500 earnings in the first quarter of 2021 suggests a stronger rebound for earnings than the forecast from the Fall 2020 snapshot.

The chart shows two previous earnings recessions for the S&P 500, going back to 2014. It also indicates that 2020-Q4 marks the bottom of the coronavirus earnings recession, which looks like it will extend into the third quarter of 2021 before the S&P 500's earnings per share recover to their pre-coronavirus recession level.

Reference

Silverblatt, Howard. Standard & Poor. S&P 500 Earnings and Estimates. [Excel Spreadsheet]. 11 February 2021. Accessed 12 February 2021. (As a bonus feature, if you follow the link to the spreadsheet before his next update, you'll find Howard's photo of New York City's 34th St. after a 17-inch snowfall in early February 2021 embedded within it!)

Fall 2020 Snapshot of Expected Future S&P 500 Earnings

Every three months, we take a snapshot of the expectations for future earnings in the S&P 500 (Index: SPX) at approximately the midpoint of the current quarter, shortly after most U.S. firms have announced their previous quarter's earnings.

The latest forecast for S&P 500 earnings through the end of 2020 suggests a less deep earnings recession than the forecast from the Summer 2020 snapshot, indicated a better-than-previously-expected bottom for the Coronavirus Recession. At the same time, S&P continues to project a robust recovery for earnings in 2021, although not as strong as it did three months ago.

Forecasts for S&P 500 Trailing Twelve Month Earnings per Share, September 2014-December 2021, Snapshot on 12 November 2020

The chart shows two previous earnings recessions for the S&P 500, going back to 2014. As you can see from the historic earnings per share data shown in the chart, Standard & Poor has a history of making optimistic projections, which are often revised downward. Changes in S&P's projections for 2021 will be something to watch as we get into 2021, especially with the prospects for a global double-dip recession.

Data Source

Silverblatt, Howard. Standard & Poor. S&P 500 Earnings and Estimates. [Excel Spreadsheet]. 12 November 2020. Accessed 19 November 2020.

Fall 2020 Snapshot of Expected Future S&P 500 Earnings

Every three months, we take a snapshot of the expectations for future earnings in the S&P 500 (Index: SPX) at approximately the midpoint of the current quarter, shortly after most U.S. firms have announced their previous quarter's earnings.

The latest forecast for S&P 500 earnings through the end of 2020 suggests a less deep earnings recession than the forecast from the Summer 2020 snapshot, indicated a better-than-previously-expected bottom for the Coronavirus Recession. At the same time, S&P continues to project a robust recovery for earnings in 2021, although not as strong as it did three months ago.

Forecasts for S&P 500 Trailing Twelve Month Earnings per Share, September 2014-December 2021, Snapshot on 12 November 2020

The chart shows two previous earnings recessions for the S&P 500, going back to 2014. As you can see from the historic earnings per share data shown in the chart, Standard & Poor has a history of making optimistic projections, which are often revised downward. Changes in S&P's projections for 2021 will be something to watch as we get into 2021, especially with the prospects for a global double-dip recession.

Data Source

Silverblatt, Howard. Standard & Poor. S&P 500 Earnings and Estimates. [Excel Spreadsheet]. 12 November 2020. Accessed 19 November 2020.