The S&P 500 is breaking the earnings playbook: Chart of the Day
Jared Blikre
Sat, July 18, 2026 at 5:26 PM GMT+5:30
2 min read
- ^GSPC
-1.01%
The S&P 500 (^GSPC) is in an earnings boom. The usual earnings bust never came
Wall Street’s forecast for S&P 500 profits over the next year has climbed to about $373 per share, up roughly 32% from a year ago
That is a rare number
Since 1990, forward earnings growth has been stronger only in the aftermath of the global <a href="https://todaytrendnews7.com/trump-has-normalized-crypto-is-it-the-path-to-the-next-financial-collapse/” title=”Trump has normalized crypto. Is it the path to the next financial collapse?”>financial crisis and the pandemic. Back then, however, Wall Street was rebounding from deep cuts to its forecasts
Not this time
Earnings per share, or EPS, measures profit on a per-share basis. Forward12-month EPS uses analysts’ estimates for the coming year rather than reported results from the past year
Kevin Gordon, head of macro research and strategy at Schwab Center for Financial Research, highlighted the contrast on X this week. Stronger growth since 1990 had only appeared after the financial crisis and pandemic, he wrote, but both periods were preceded by “massive plunges in EPS estimates.”
The numbers back him up
Forward S&P 500 earnings fell about 38% around the financial crisis and 22% during the pandemic. The dip preceding the current boom was only about 6%
The market still got a reset. It just came through stock prices instead of collapsing profits
During the S&P 500’s 25% bear-market slide from January through October 2022, forward EPS actually rose about 5%. Forecasts peaked later and ultimately fell just 6%
That sent the index’s forward price-to-earnings ratio, which compares current prices with expected profits, from about 21.5 times earnings to 15.3 times
In plain English, stocks got much cheaper before the profit outlook meaningfully weakened
The current boom is not confined to one tiny pocket of the market. All 11 S&P 500 sectors have positive forward earnings growth, and eight are growing at double-digit rates
Still, the gains are far from even
Technology leads with roughly 82% growth, powered in part by the chip industry’s enormous profit surge. The Magnificent Seven are growing around 44%, compared with roughly 21% for the equal-weight S&P 500
Because the equal-weight index gives every company the same influence, that 21% figure shows the boom reaches well beyond the megacaps — even if the biggest companies are still pulling the headline number higher
That gives investors a different kind of earnings test
The last two booms could lean on a rebound from crushed forecasts. This one cannot
With earnings season underway and Big Tech results right around the corner, companies now have to deliver the profits Wall Street has already penciled in
Jared Blikre is the global markets and data editor for Yahoo Finance. Follow him on X at@SPYJaredor email him at jaredblikre@yahooinc.com
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