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Aggregate Estimates and Revisions
- 22Q1 Y/Y earnings are expected to be 11.3%. Excluding the energy sector, the Y/Y earnings estimate is 5.2%.
- Of the 495 companies in the S&P 500 that have reported earnings to date for 22Q1, 77.4% have reported earnings above analyst estimates. This compares to a long-term average of 66% and prior four quarter average of 83.1%.
- During the week of Jun. 6, 3 S&P 500 companies are expected to report quarterly earnings.
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22Q1 Earnings Growth Highlights
The estimated earnings growth rate for the S&P 500 for 22Q1 is 11.3%. If the energy sector is excluded, the growth rate declines to 5.2%. The S&P 500 expects to see share-weighted earnings of $453.1B in 22Q1, compared to share-weighted earnings of $407.2B (based on the year-ago earnings of the current 504 constituents) in 21Q1.
Eight of the 11 sectors in the index expect to see an improvement in earnings relative to 21Q1. The energy and materials sectors have the highest earnings growth rates for the quarter, while the consumer discretionary sector has the weakest anticipated growth compared to 21Q1.
The energy sector has the highest earnings growth rate (268.8%) of any sector. It is expected to earn $34.8B in 22Q1, compared to earnings of $9.4B in 21Q1. Four of the five sub-industries in the sector are anticipated to see higher earnings than a year ago. The integrated oil & gas (293.5%) and oil & gas refining & marketing (274.4%) sub-industries have the highest earnings growth in the sector. If these sub-industries are removed, the growth rate declines to 138.1%.
The materials sector has the second highest earnings growth rate (46.2%) of any sector. It is expected to earn $16.4B in 22Q1, compared to earnings of $11.2B in 21Q1. Eight of the ten sub-industries in the sector are anticipated to see higher earnings than a year ago. The steel (145.8%) and fertilizers & agricultural chemicals (140.8%) sub-industries have the highest earnings growth in the sector. If these sub-industries are removed, the growth rate declines to 25.8%.
The consumer discretionary sector has the lowest earnings growth rate (-27.7%) of any sector. It is expected to earn $22.4B in 22Q1, compared to earnings of $31.0B in 21Q1. Nine of the 21 sub-industries in the sector are anticipated to see lower earnings than a year ago. The internet & direct marketing retail (-134.6%) and leisure products (-43.0%) sub-industries have the lowest earnings growth in the sector. If these sub-industries are removed, the growth rate improves to 7.6%.
22Q2 Earnings Growth Highlights
The estimated earnings growth rate for the S&P 500 for 22Q2 is 5.3%. If the energy sector is excluded, the growth rate declines to -1.9%. The S&P 500 expects to see share-weighted earnings of $463.6B in 22Q2, compared to share-weighted earnings of $440.1B (based on the year-ago earnings of the current 504 constituents) in 21Q2.
Six of the 11 sectors in the index expect to see an improvement in earnings relative to 21Q2. The energy and industrials sectors have the highest earnings growth rates for the quarter, while the financials sector has the weakest anticipated growth compared to 21Q2.
The energy sector has the highest earnings growth rate (202.1%) of any sector. It is expected to earn $47.3B in 22Q2, compared to earnings of $15.7B in 21Q2. All five sub-industries in the sector are anticipated to see higher earnings than a year ago. The oil & gas refining & marketing (568.3%) and oil & gas exploration & production (217.2%) sub-industries have the highest earnings growth in the sector. If these sub-industries are removed, the growth rate declines to 162.2%.
The industrials sector has the second highest earnings growth rate (30.1%) of any sector. It is expected to earn $37.5B in 22Q2, compared to earnings of $28.9B in 21Q2. Fifteen of the 17 sub-industries in the sector are anticipated to see higher earnings than a year ago. The airlines (183.8%) and construction & engineering (45.2%) sub-industries have the highest earnings growth in the sector. If these sub-industries are removed, the growth rate declines to 8.0%.
The financials sector has the lowest earnings growth rate (-18.3%) of any sector. It is expected to earn $68.6B in 22Q2, compared to earnings of $83.9B in 21Q2. Ten of the 12 sub-industries in the sector are anticipated to see lower earnings than a year ago. The reinsurance (-43.6%) and consumer finance (-27.9%) sub-industries have the lowest earnings growth in the sector. If these sub-industries are removed, the growth rate improves to -17.2%.
Exhibit 1: S&P 500 – Estimate Revisions by Sector
Exhibit 2: S&P 500 – Estimate Revisions History
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