S&P 500 Sectors & Industries Profit Margins

S&P 500 Sectors & Industries Profit Margins (quarterly)

Yardeni Research, Inc.

January 21, 2020

Dr. Edward Yardeni

516-972-7683 eyardeni@

Joe Abbott

732-497-5306 jabbott@

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Table Of Contents Table Of Contents

S&P 500 Operating Profit Margins S&P 500 Profit Margin S&P 500 Sectors Operating Profit Margins S&P 500 Sectors Forecasted & Actual Profit Margins Consumer Discretionary Consumer Staples Energy Health Care Industrials Information Technology Materials Communication Services

3-6 7 8

5-6 7 8 9

10 11 12 13-14

January 21, 2020 / S&P 500 Sectors & Industries Profit Margins

Yardeni Research, Inc.



S&P 500 Profit Margin

Figure 1.

14

S&P 500 PROFIT MARGIN 12 (percent, quarterly)

14

Q3

12

10

10

8

8

6

6

4

4

2

2

0

0

-2

-2

-4

Operating (11.9)

-4

-6

Reported (9.6)

-6

-8

-8

-10

-10



-12

-12

94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

Source: Standard & Poor's Corporation (revenues and reported EPS) and I/B/E/S data by Refinitiv (operating EPS).

Figure 2.

13

S&P 500 PROFIT MARGIN 12 (percent, trailing four-quarter average)

11

13

Q3

12

11

10

10

9

9

8

8

7

7

6

6

5

5

4

4

3

Operating (11.8)

3

2

Reported (9.5)

2

1

1



0

0

94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

Source: Standard & Poor's (revenues and reported EPS) and I/B/E/S data by Refinitiv (operating EPS).

Page 3 / January 21, 2020 / S&P 500 Sectors & Industries Profit Margins

Yardeni Research, Inc.



S&P 500 Profit Margin

Figure 3.

15

S&P 500 OPERATING PROFIT MARGIN (percent)

Quarterly (11.9)

Trailing four-quarter

10

average (11.8)

15

Q3 10

5

5



0

0

94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

Source: Standard & Poor's Corporation (revenues) and I/B/E/S data by Refinitiv (operating EPS).

Figure 4.

15

S&P 500 REPORTED PROFIT MARGIN (percent)

10

5

15

Q3

10

5

0

0

Quarterly (9.6)

-5

Trailing four-quarter

-5

average (9.5)

-10

-10



-15

-15

92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21

Source: Standard & Poor's Corporation.

Page 4 / January 21, 2020 / S&P 500 Sectors & Industries Profit Margins

Yardeni Research, Inc.



S&P 500 Profit Margin

Figure 5.

14

S&P 500 PROFIT MARGIN (percent, dividing forward earnings by forward revenues)

13

14

20 13

12

1/16

12

19

18

11

11

10

10

9

9

8

Consensus Forecasts

8

Annual

52-week forward* (12.0)

7

7



6

6

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

* Time-weighted average of the consensus estimates for current year and next year. Monthly through December 2005, then weekly. Source: I/B/E/S data by Refinitiv.

Figure 6.

13

S&P 500 PROFIT MARGIN MEASURES (percent)

12

11

13

1/16

12

Q3

11

10

10

9

9

S&P 500 Operating Profit Margins

8

Forward*

8

Actual (trailing 4Q average)

7

7

6

6

5 2006 2007 2008 2009 2010 2011 2012

* Forward earnings divided by forward revenues. Source: I/B/E/S data by Refinitiv and Standard & Poor's.

2013

2014

2015

2016

2017

2018

2019

5

2020 2021

Page 5 / January 21, 2020 / S&P 500 Sectors & Industries Profit Margins

Yardeni Research, Inc.



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