Full Year Earnings Estimates Holding Up So Far

As of August 9, 2019, some 450 of the S/P 500 Index companies have reported June quarterly results ( Bloomberg L.P.). According to the FACTSET database (August 9) the S/P 500 earnings for the 2019 year are now forecast at $165.51, some 2.5% above the 2018 figure. Earlier in the year (February 15) the FACTSET estimate for 2019 was $169.53. As we can see, the analyst estimates are coming down, but earnings are still expected to grow for the 2019 year. The latest figure for 2020 is 183.23 which would be almost 11% higher than the current forecast for the 2019 year.

With the S/P 500 Index at the 2,800 level, the PE ratio for the 2020 earnings year would be 15.3x which is not cheap, but not overly expensive with interest rates ( the Treasury 10-year bond yields just 1.64%) so low the multiple appears reasonable.