S&P Earnings Estimates

Runner Twentysix wrote

S&P operating earnings estimates as posted by S&P for ‘08 and ’09.

Operating earnings estimates drifted over the past 2 weeks as few companies are now reporting. It is just drips and drabs right now. Reporting will pickup in earnest about the middle of July.

.....…………....2008………2009
08/07/2007…106.59 <-------2008 high
…
01/14/2008…100.32
01/22/2008….99.21
01/29.2008….99.00
02/05/2008….99.86
02/12/2008….99.51
02/19/2008….98.99
02/26/2008….98.63
03/04/2008….96.55
03/11/2008….96.71
03/18/2008….96.42
03/25/2008….96.26
03/31/2008….96.74
04/10/2008….96.79……115.42
04/16/2008….93.62……113.30
04/22/2008….92.31……112.17
04/28/2008….91.69……111.81
05/06/2008….90.91……110.29
05/13/2008….89.43……110.44
05/20/2008….89.29……109.53
05/27/2008….89.07……108.98
06/03/2008….89.27……109.04
06/10/2008….89.38……110.19
06/16/2008….89.03……109.94
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At Brinker's 16 to 17 times operating earnings, applying it to the S&P 6/16 estimate places the value for 2008 now at 1424 to 1514, and 2009 at 1759 to 1869. (FYI, the 2006 actual earnings were 87.72 and 2007 actual earnings were 82.54)

• Kirk Comment: 16 x $89.03 = $1,424.48
  

The ‘Word” is that Bob is projecting 1600 near the end of ’08 or into ’09. On 4/6/08, he stated on the show that he expected record highs near the end of ’08, which means 1565.15 on a closing basis, as Bob mentioned this number on his show.
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Brinker said on Saturday April 5, 2008: “My number for the S&P 500 for 2008 is way below, way below the Wall Street number for 2008.” LOL, see Kirks comments
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Bob Norton's Evergreen was last reported on May 19, 2008 “we continue to project flat earnings ($85.00) for the full year and would consider the S&P 500 to be fairly valued within the range of 1450 by year end.” At 16 to 17 times earnings, 85.00 for 2008 would give a range of 1360 to 1445. In June, they reconfirmed holding at this estimate.

John Mauldin commented in "Outside the Box" that : "As if this wasn't bad enough, in the past we have shown that analysts tend to be around about 10% too optimistic in their year-ahead forecasts of the earnings level. However, in recession years this jumps to 30% too optimistic. "

See Normxxx’s interesting posting “The Real P/E Ratio” here:

ECRI Says Inflation Pressure Fell in May 2008

ECRI says U.S. inflation pressures slipped in May, as disinflationary moves in measures of jobs, loans and vendor performance offset inflationary moves in interest rates and commodities prices, a report said on Friday.

The Economic Cycle Research Institute's U.S. Future Inflation Gauge (FIG), designed to anticipate cyclical swings in the rate of inflation, slipped to 116.7 in May from 116.9 in April, revised from 117.2.

The index's annualized growth rate, which smooths out monthly fluctuations, rose to minus 2.2 from minus 2.5 percent in April, revised from negative 2.0 percent.