S&P 500 Earnings: S&P 500 EPS Growth For 2025 Has Risen From 8% To 10% Since Late June

Estimated S&P 500 EPS growth for 2025 has been revised upward, increasing from 8% in late June to 10% by late August. This positive trend extends across all S&P 500 EPS estimates for calendar years 2025, 2026, and 2027, which have also moved higher. The primary drivers of this growth are the Technology and Communication Services sectors.

Analysis

Analyst estimates for S&P 500 earnings per share (EPS) growth in 2025 have been revised upward significantly, rising from 8% in late June to 10% by late August. This revision signals a strengthening outlook for corporate profitability, a trend that extends to calendar years 2026 and 2027, which also saw substantial positive estimate adjustments. The source of this improved forecast is highly concentrated, with the Technology and Communication Services sectors identified as the primary, if not sole, drivers of the earnings growth. This concentration suggests a bifurcated market, where these two sectors are disproportionately responsible for the index's positive trajectory, a notable development given the more pessimistic environment suggested in early April 2025.

Key Decisions for Investors

• Given that Technology and Communication Services are the primary drivers of earnings growth, investors should review portfolio allocations to ensure sufficient exposure to these outperforming sectors.
• The high concentration of growth presents a risk; it is prudent to monitor for signs of broadening market participation or potential weakness in these leading sectors.
• Investors should re-evaluate forward valuations for the S&P 500, particularly within tech and communication services, to assess whether the higher earnings expectations are already reflected in current stock prices.