Analysts Predict Double-Digit Earnings Growth for S&P 500 in 2024 and 2025, FactSet Reports

Industry analysts are projecting strong earnings growth for the S&P 500 in both 2024 and 2025, with double-digit growth anticipated in both years, according to a note published by FactSet.

Analysts collectively predict that the S&P 500 will report year-over-year earnings growth of 11.3% in 2024 and 14.4% in 2025. If these forecasts materialize, it would mark the third time in the past 15 years that the index has reported two consecutive years of double-digit earnings growth.

"Industry analysts in aggregate predict the S&P 500 will report year-over-year earnings growth of 11.3% in 2024 and 14.4% in 2025," states FactSet.

This positive outlook is driven by widespread growth expectations across most sectors. For 2024, nine out of eleven sectors are predicted to report year-over-year earnings growth, with four of these sectors projected to achieve double-digit growth. The Communication Services and Information Technology sectors are expected to lead the way with 21.0% and 18.8% growth, respectively.

The positive outlook extends into 2025, with all eleven sectors anticipated to report year-over-year earnings growth. Eight of these sectors are projected to report double-digit growth, led by the Information Technology (19.5%) and Health Care (18.5%) sectors.

It is noteworthy that these current earnings growth rate estimates for both years are higher than expectations at the start of the year. On December 31, the estimated earnings growth rates for the S&P 500 for 2024 and 2025 were 11.2% and 12.7%, respectively. This indicates that analysts have become more optimistic about corporate earnings in recent months.

These strong earnings growth projections for the S&P 500 suggest a positive outlook for the broader equity market in the coming years.