Each three months, we take a snapshot of the expectations for future earnings within the S&P 500 (Index: SPX) at roughly the midpoint of the present quarter, shortly after most U.S. corporations have introduced their earlier quarter’s earnings.
The newest forecast for S&P 500 earnings by way of the tip of 2020 suggests a much less deep earnings recession than the forecast from the Summer 2020 snapshot, indicating a better-than-previously-expected backside for the Coronavirus Recession. On the identical time, S&P continues to undertaking a strong restoration for earnings in 2021, though not as robust because it did three months in the past.
The chart reveals two earlier earnings recessions for the S&P 500 going again to 2014. As you may see from the historic earnings per share knowledge proven within the chart, Commonplace & Poor’s has a historical past of constructing optimistic projections, which are sometimes revised downward. Modifications in S&P’s projections for 2021 will probably be one thing to observe as we get into 2021, particularly with the prospects for a global double-dip recession.
Silverblatt, Howard. Commonplace & Poor’s. S&P 500 Earnings and Estimates. [Excel Spreadsheet]. 12 November 2020. Accessed 19 November 2020.
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