The first quarter reporting period is already starting, but we have only just received the final S&P 500 Q4 earnings numbers. As expected, the index’s earnings clocked a year over year decline, and while it turned out slightly better than what analysts were predicting at the beginning of January, it still wasn’t a pretty picture.
S&P 500 Q4 earnings decline 4.17%
S&P Capital IQ Senior Analyst Lindsey Bell said S&P 500 Q4 earnings declined 4.17% to $29.28 per share, which was better than the 5.3% decline that was predicted at the beginning of the year. It was also the worst quarterly earnings decline since the second quarter of 2009, she said. Half of the sectors in the index posted positive earnings growth, with Telecom leading the way and Consumer Discretionary coming in second. Healthcare came in third place, and all three of these sectors also led the growth in the second and third quarters of 2015.
Unsurprisingly, the Energy sector continued to weigh on the S&P 500 Q4 earnings with a 73% decline. Materials also saw a significant year over year decline in earnings.
For the first quarter of 2022, the Voss Value Fund returned -5.5% net of fees and expenses compared to a -7.5% total return for the Russell 2000 and a -4.6% total return for the S&P 500. According to a copy of the firm’s first-quarter letter to investors, a copy of which ValueWalk has been able Read More
Excluding the drag from the Energy sector, Bell said S&P 500 Q4 earnings would have grown 2.1%. Here’s a look at how estimates for the S&P 500 Q4 earnings developed over the last year.
She said the beat rate was 65%, which came in slightly lower than the 66% historic average.
The S&P 500 trades at a multiple of 17.6 times forward price to earnings ratio, which she said is a premium to the 15-year average.
Looking to the first quarter
The first quarter reporting period is already starting to get underway with Micron Technology, Carnival and others being among the first to report, although the unofficial start to the first quarter reporting period is April 11 when Alcoa reports before opening bell. Here’s a look at how the current estimates stand:
And here’s a look further out at the estimates for the second and third quarters:
All charts in this article are courtesy S&P Capital IQ.