Q3 and Q4 Sector Earnings Growth

With about 96% of S&P 500 companies having reported third quarter earnings, current EPS growth numbers for the quarter should be very close to what the final tally will read.  As shown below, four sectors have had negative year over year growth in the third quarter, while six have had positive growth. 

Financials and consumer discretionary were once again the sectors that brought down the index as a whole.  Financials have seen earnings decline by 129.7% in Q3 '08 vs Q3 '07.  Consumer discretionary has seen earnings decline by 41.4%.  Telecom and utilities are the two other sectors with negative Q3 earnings growth, and the S&P 500 as a whole currently stands at -18.4%. 

The energy sector has had by far the largest earnings growth at 57.4% vs the third quarter of 2007.  Consumer staples ranks second behind energy at 10.9%, followed by health care, materials, technology, and industrials.

So what does the fourth quarter look like?  Analysts are expecting the S&P 500 to actually show positive year over year earnings growth in the fourth quarter of 4%.  This is because the financial sector is expected to show growth of 64.2% due to the fact that Q4 '07 was so bad.  Utilities, health care, and consumer staples are the other three sectors expected to see earnings growth, while consumer discretionary, materials, energy, telecom, technology and industrials are expected to see earnings declines. 

 

 

Comments

[Lynn:]

Financial sector earnings are projected to grow 64.20% in 2008Q4? How big of a bailout are they expecting?

2008 Nov 25 03:52 PM