Earnings (General News) 03 (Jan 24 - Dec 27)

[behappyalways]

Mag 7 earnings growth continues to outpace the rest of the S&P 500, though it is slowing
https://x.com/Mayhem4Markets/status/1987170378595082500

[winston]

2025 Earnings

The S&P 500 reported a 12.9% earnings growth in the first quarter of 2025 and 12% in the second quarter. Then in the third quarter, 81% of companies in the index went on to beat earnings expectations – a big jump from the 73% average in 2013.

As for 2026, Yardeni also mentioned that he believes “that S&P 500 companies’ collective earnings per share will increase from $268 this year to $310 next year.”

Source: Smart Money

[winston]

3Q Earnings

Now that the third-quarter earnings announcement season has officially wrapped up, here is where we stand:-

According to FactSet, 83% of S&P 500 companies posted a positive earnings surprise and 76% achieved a positive revenue surprise.

The S&P 500 reported a 6.6% average earnings surprise and a 2% average revenue surprise.

I should add that the S&P 500 achieved 13.4% average earnings growth and 8.4% average revenue growth for the third quarter.

So earnings growth and earnings surprises are at the highest pace in four years, while revenue is running at its highest pace in three years.

And the great news is that earnings and revenue are forecast to accelerate in 2026.

Source: Investor Place

[winston]

Q3 Earnings

We’re nearing the end of Q3 earnings season and we’ve seen strong earnings numbers. As importantly, forecasts remain solid.

From FactSet:-

For Q4 2025, analysts are projecting earnings growth of 7.5% and revenue growth of 7.1%.

For Q1 2026, analysts are projecting earnings growth of 11.8% and revenue growth of 7.7%.

For Q2 2026, analysts are projecting earnings growth of 12.7% and revenue growth of 6.8%.

If these figures play out, the Wall Street party will continue. But recognize the reality…

If Lower-K Americans play less of a role in today’s economy… and if the wealth effect is playing an outsized role… then the moment earnings roll over, the feedback loop unwinds – painfully.

Source: Investor Place

[winston]

Economic growth could accelerate meaningfully in 2026

Key interest rate cuts and the ongoing data center boom, coupled with a shrinking trade deficit and increased onshoring, could converge to boost U.S. GDP growth to at least 5% in 2026.

Fourth-quarter earnings are now forecast to increase 8.1%, up from estimates for 7.2% at the end of September…

After that, earnings and revenue are expected to accelerate in 2026, driven by higher guidance, especially from data center companies with a growing order backlog.

FactSet currently projects earnings will accelerate to a 14.5% annual pace in calendar year 2026.

Source: Investor Place

[winston]

FactSet expects the S&P 500 to achieve 12.1% average earnings growth in calendar year 2025 and earnings will accelerate to an average of 14.5% in calendar year 2026.

[winston]

4Q Earnings

Of the companies that have reported, 73% have beaten expectations, and analysts now expect aggregate year-on-year S&P 500 earnings growth of 13.9%, significantly higher than the 8.9% forecast as of January 1, according to LSEG data.

Source: The Standard
https://www.thestandard.com.hk/market/article/325092/

[behappyalways]

It's hard to overemphasize how important tech is to this market, so here's a statistic that helps to drive it home.
https://x.com/Mayhem4Markets/status/2038331960855077267