Now, if you join me at Platinum Growth Club, you’ll receive the Breakthrough Stocks Monthly Issue and recommendations as soon as they’re released. I’ll also reveal my newest addition to my Breakthrough Stocks Buy List: a company that achieved record revenue in the second quarter and triple-digit earnings growth. I’ll explain why my Breakthrough Stocks’ earnings are bucking the S&P 500’s trend in tomorrow’s Monthly Issue. They’ve also benefitted from an average 11.9% increase in earnings estimates in the past month. I should also add that our Buy List stocks are currently trading at a median price-to-earnings ratio of 10.9X current earnings and only 4.65X median forecasted earnings. My Breakthrough Stocks Buy List remains characterized by 43.3% average annual sales growth and 204.1% average annual earnings growth. That’s exactly the case with my Breakthrough Stocks. To be successful in the current market environment, you need to remain invested in companies that are able to maintain robust earnings and sales growth, as well as benefit from positive analyst estimates. Invest In Companies With Growing Earnings My favorite economist, Ed Yardeni, expects the S&P 500’s earnings to decline 5.4% in the third quarter. So, while it pains me to say this, the upcoming third-quarter earnings season will be ugly for many S&P 500 companies. Year-over-year comparisons are also growing more difficult. The reality is that nearly half of the S&P 500’s revenues come from outside of the U.S., so many multinational companies are struggling due to a strong U.S. Only two of the S&P 500’s 11 sectors have had earnings estimates increased in the past two months, with energy’s earnings estimates upped by 9.6%. Earnings estimates have been slashed by an average 5.4%. Most of the S&P 500’s industries are now forecast to post earnings declines for the rest of 2022 – and this earnings decline is the third storm cloud overhanging Wall Street.Īccording to FactSet, the analyst community has lowered third-quarter earnings estimates by a bigger margin than normal. The Third Storm Cloud Overhanging Wall Street I’ll talk in more depth about each of these clouds in tomorrow’s Breakthrough Stocks Monthly Issue for September, but for today’s Market 360 I’d like to give you a sneak peek at the third storm cloud: a decline in S&P 500 earnings. Unfortunately, I don’t expect the volatility to ebb, as there are several clouds hanging over Wall Street that could continue to weigh on stocks. The fact is there is a lot of noise in the market right now affecting the price of stocks… everything from Federal Reserve commentary and action to continuing COVID-19 lockdowns in China.Ĭouple this with the fact that September is historically the worst month for the stock market, and the latest bout of volatility is not a surprise. (I’ll talk in more detail about Apple’s big event in tomorrow’s Market 360, so stay tuned for that!) I explained to my Platinum Growth Club subscribers in a Special Market Podcast that the rally was largely due to Apple, Inc.’s (NASDAQ: AAPL) iPhone 14 announcement and a decline in the 10-year Treasury yield. We had a bit of a reprieve from selling yesterday, with the S&P 500 up 1.8%, the Dow up 1.4% and the NASDAQ up 2.4%. As I mentioned in Tuesday’s Market 360, the stock market failed to launch. All of the major indices sold off hard in the latter half of August, with the S&P 500 and Dow falling more than 4% for the month.
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