We’ve gotten some encouraging news on the earnings front lately. As this week’s chart shows, after months of steady cuts, analysts have finally stopped lowering their S&P 500 earnings estimates.
Each line in the chart tracks the year-over-year growth forecast for earnings in Q2, Q3, and Q4. You can see how sharply expectations were lowered earlier this year — especially as headlines around tariffs rattled the market.
But now, things seem to have leveled off. That likely means expectations have reset to more reasonable levels, which can be a healthier foundation for future returns. In fact, we’ve even seen a small bump in earnings forecasts recently.
The bottom line? For now, the bleeding has stopped — and that’s a step in the right direction.
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Indices mentioned are unmanaged, do not incur fees, and cannot be invested into directly.
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The S&P 500 Index, or Standard & Poor’s 500 Index, is a market-capitalization-weighted index of 500 leading publicly traded companies in the U.S.