NTM Sales Estimates Are On The Rise, Longer Outlook Not As Positive by Eric Bush, CFA – Gavekal Capital Blog
Analysts have become more optimistic regarding sales growth over the next year while tampering their excitement for sales growth in the period 12-24 months from now. Median next 12 month (NTM) sales growth estimates have nearly doubled since the beginning of the year. For developed market equities, the median NTM sales growth estimate has increased from 3% on February 1st to 6% as of yesterday. In the emerging markets, the median NTM sales growth estimate has increased from 5% on January 21st to 9% as of yesterday. And in the combined all country index, the median NTM sales growth estimate has increased from 4% on February 2nd to 7% as of yesterday.
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NTM Sales Estimates
Like we mentioned above, while analysts are more optimistic regarding sales growth over the next 12 months they are markedly more pessimistic about growth prospects for the period 12-24 months from now (second 12 months or STM). Median STM sales growth estimates in the emerging markets is just 7%, even lower than growth expectations were at the equity trough in 2009. DM and AC sales growth estimates haven’t broken through 2009 levels yet, but they are quickly approaching those levels. Analysts peg the median DM STM sales growth estimate at just 4% and the AC STM sales growth estimate at just 5%.