2017 Estimates For S&P500 Earnings & Price Levels

In the December 19, 2016 edition of Barron’s, the cover story is titled “Outlook 2017:  This Bull Has Legs.”

Included in the story, 10 investment strategists give various forecasts for 2017 including S&P500 profits, S&P500 year-end price targets, GDP growth, and 10-Year Treasury Note Yields.

A couple of excerpts:

Every September and December, Barron’s surveys a group of prominent strategists at major investment banks and money-management firms to gauge their outlook for stocks, bonds, and the economy in the months and year ahead. In our previous survey three months ago, this normally upbeat crew was bearish for the first time in many years (“Barron’s Survey: Strategists Say Beware the Bear,” Cover Story, Sept. 3). Now they have returned to optimistic form, noting that Corporate America will get a significant boost to profits from anticipated lower corporate taxes, infrastructure spending, and reduced regulations under a Republican-dominated federal government that takes office next year. They expect job growth to accelerate, too.


Our prognosticators forecast aggregate growth in S&P 500 earnings of about 7% next year, to $127 from an expected $118.75 in 2016. In most cases, the 2017 number doesn’t include the majority of Trump’s proposed reforms. Instead, it reflects incremental earnings gains plus a sharp rebound in energy-company profits, now that oil prices have nearly doubled from their February low. The Trump agenda, in force, could add $5 to $10 to S&P earnings, the strategists say. Industry analysts are forecasting 2017 earnings of $132.69, a 12% increase over this year.

The average estimate for the S&P500 at the end of 2017 is 2380.

The article also mentions that among the investment strategists, average expected 2017 GDP growth is 2.4%.


I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.


The Special Note summarizes my overall thoughts about our economic situation

SPX at 2258.07 as this post is written