Global Index Briefing: S&P 500

Global Index Briefing: S&P 500

Yardeni Research, Inc.

October 29, 2021

Dr. Ed Yardeni

516-972-7683 eyardeni@

Joe Abbott

732-497-5306 jabbott@

Please visit our sites at blog.

thinking outside the box

Table Of Contents Table Of Contents

S&P 500

Stock Price Index

1

Forward Revenues & Earnings with Annual Squiggles

2

Annual Growth Squiggles

3

Margins & NERI

4

Forward Growth & Valuation

5-6

October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



Figure 1.

4900

4400 S&P 500 INDEX*

3900 3400 2900 2400 1900

1400

900

Stock Price Index

10/29

4900 4400 3900 3400 2900 2400

1900

1400

900



400

400

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 22 23 24

200-day moving average. * Ratio scale.

Source: Standard & Poor's and Haver Analytics.

Figure 2.

5500

S&P 500, FORWARD EARNINGS, AND VALUATION

5000

(weekly)

4500

4000

Blue Angels: S&P 500

Actual 10/29/21

3500

Implied* 10/21/21

3000

2500

2000

x24 x22 10/29 x20 x18 x16 x14 x12 x10

5500 5000 4500 4000 3500 3000 2500 2000

1500

1500

1000

1000



500

500

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

* Implied price index calculated using forward earnings times forward P/Es. Weekly data start January 2007. Source: Standard & Poor's and I/B/E/S data by Refinitiv.

Page 1 / October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



Forward Revenues & Earnings with Annual Squiggles

Figure 3.

1700

S&P 500 REVENUES PER SHARE (consensus analysts estimates in dollars, weekly)

1500

21 22

10/21

1700 1500

1300

1300

1100

1100

900

900

Consensus Forecasts

Annual estimates

Forward revenues*



700

700

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

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

Figure 4.

245

S&P 500 OPERATING EARNINGS PER SHARE 215 (analysts' average forecasts, ratio scale)

185

155

125

245

10/21

215

21

22

185

155

125

95

95

65

65

Consensus Forecasts

Annual estimates

Forward earnings*



35

35

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 22 23 24

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

Page 2 / October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



Annual Growth Squiggles

Figure 5.

16

S&P 500 REVENUES ANNUAL GROWTH FORECASTS* 14 (based on analysts' consensus estimates, percent, weekly)

16 21

14

12

12

10

11

8

6

10

18 8

17

22 6

4

19

4

14

2

12

13

16

2

0

2017 (6.4)

0

-2

2018 (8.9) 2019 (4.1)

-4

2020 (-2.8) 2021 (15.1)

-2 20

15

-4

-6

2022 (6.9)

-6

Latest data thru 10/21/21



-8

-8

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: I/B/E/S data by Refinitiv.

Figure 6.

50

50

S&P 500 OPERATING EARNINGS ANNUAL GROWTH FORECASTS*

21

(based on analysts' consensus estimates, percent, weekly)

40

40

30

30

18

20

20

11

10

17

22

10

12

13

14

0 2017 (11.2)

2018 (23.8)

-10

2019 (1.4)

2020 (-13.9)

2021 (47.6)

-20

2022 (8.8)

15

16

19

0

-10 20

-20

Latest data thru 10/21/21



-30

-30

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

Source: I/B/E/S data by Refinitiv.

Page 3 / October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



Margins & NERI

Figure 7.

14

S&P 500 PROJECTED PROFIT MARGIN (using analysts' average earnings and revenues forecasts)

13

14

10/21

21

13

22

12

12

11

11

10

10

9

9

8

Consensus Forecasts

8

Annual estimates

Forward profit margin* (13.2)

7

7



6

6

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

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

Figure 8.

30

S&P 500 NET EARNINGS REVISIONS INDEX*

20

10

NERI

Aug 21.8 Sep 20.2 Oct 16.1

30

20 Oct

10

0

0

-10

-10

-20

-20

-30

-30

-40

-40



-50

-50

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 22 23 24

* Three-month moving average of the number of forward earnings estimates up less number of estimates down, expressed as a percentage of the total number of forward earnings estimates. Source: I/B/E/S data by Refinitiv.

Page 4 / October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



Forward Growth & Valuation

Figure 9.

30

S&P 500 VALUATION MULTIPLE* (weekly

25

20 Forward P/E (21.1)

15

30

25 10/21

20

15

10

10



5

5

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 22 23 24

* Price divided by forward consensus expected earnings per share. Monthly data through December 2005, weekly thereafter. Source: I/B/E/S data by Refinitiv.

Figure 10.

1.25

S&P 500 RELATIVE VALUATION*

1.20

1.15

1.25

1.20

10/21

1.15

1.10

1.10

1.05

1.05

1.00

1.00

.95

.95

.90

Relative P/E (1.15)

.90

.85

.85

.80

.80

.75

.75



.70

.70

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 22 23 24

* Forward P/E of index relative to All Country World MSCI forward P/E. Monthly data through December 2005, weekly thereafter. Source: I/B/E/S data by Refinitiv.

Page 5 / October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



Forward Growth & Valuation

Figure 11.

35

35

S&P 500 STRG, STEG, & LTEG*

(percent)

30

30

LTEG (22.6)

STEG (12.8)

25

STRG (8.0)

25

20

20

15

15

10/21

10

10

5

5

0

0

-5

-5

-10

-10

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024

* STEG is year-ahead forward consensus expected short-term earnings growth. STRG is year-ahead forward consensus expected short-term revenue growth. LTEG is five-year consensus expected long-term earnings growth. Source: I/B/E/S data by Refinitiv.

Figure 12.

30

S&P 500 VALUATION

25

20

15

10

5 2.5

Forward P/E* (20.4)

30

25

10/7

20

15

10

5 2.5

2.0

PEG Ratio*** (0.9)

2.0

1.5

1.5

1.0

1.0



.5

.5

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 22 23 24

* Price divided by 12-month forward consensus expected operating earnings per share. ** Sector or industry forward P/E relative to S&P 500 forward P/E. *** Sector or industry forward P/E relative to sector or industry consensus 5-year LTEG forecast.

Source: I/B/E/S data by Refinitiv.

Page 6 / October 29, 2021 / Global Index Briefing: S&P 500

Yardeni Research, Inc.



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