Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Stocks

2022 Q2 Final: Earnings Have Peaked

by October 13, 2022
October 13, 2022
2022 Q2 Final: Earnings Have Peaked

The following chart shows us the normal value range of the S&P 500 Index, indicating where the S&P 500 would have to be in order to have an overvalued P/E of 20 (red line), a fairly valued P/E of 15 (blue line), or an undervalued P/E of 10 (green line). Annotations on the right side of the chart show where the range is projected to be based upon earnings estimates for the next four quarters, through 2023 Q2. Note that actual earnings peaked in Q2, and earnings projections are flattening.

Historically, price has usually remained below the top of the normal value range (red line); however, since about 1998, it has not been uncommon for price to exceed normal overvalue levels, sometimes by a lot. The market has been mostly overvalued since 1992, and it has not been undervalued since 1984. We could say that this is the “new normal,” except that it isn’t normal by GAAP (Generally Accepted Accounting Principles) standards.

We use GAAP earnings as the basis for our analysis. The table below shows earnings projections through June 2023. Keep in mind that the P/E estimates are calculated based upon the S&P 500 close as of September 30, 2022. They will change daily depending on where the market goes from here. It is notable that the P/E is finally within the normal range, albeit still in the overvalued side of the range.

The following table shows where the bands are projected be, based upon earnings estimates through 2023 Q1.

This DecisionPoint chart keeps track of S&P 500 fundamentals, P/E and yield, and it is updated daily — not that you need to watch it that closely, but it is up-to-date when you need it.

CONCLUSION: With a P/E of 18.6, earnings are within the normal range, but the market is still overvalued; however, earnings have begun to fall causing the normal range to fall as well. Perhaps the bright side of the bear market is that falling prices will keep valuations within the normal range.

Technical Analysis is a windsock, not a crystal ball. –Carl Swenlin

(c) Copyright 2022 DecisionPoint.com

Helpful DecisionPoint Links:

DecisionPoint Alert Chart List

DecisionPoint Golden Cross/Silver Cross Index Chart List

DecisionPoint Sector Chart List

DecisionPoint Chart Gallery

Trend Models

Price Momentum Oscillator (PMO)

On Balance Volume

Swenlin Trading Oscillators (STO-B and STO-V)

ITBM and ITVM

SCTR Ranking

Bear Market Rules Earnings

0
FacebookTwitterGoogle +Pinterest
previous post
CHANGE: Tulsi Gabbard Now Stumping For GOP Senate Candidate
next post
NATO Moves Ahead with Nuclear Deterrent Drills Next Week

You may also like

At the Edge of Chaos: Volatile Oil and...

September 5, 2022

How To Manage Risk Using Technical Analysis!

July 11, 2024

Special Note: Inverted Head & Shoulders; This Bullish...

August 9, 2022

Stock Market Weekly Wrap Up: The Charts You...

September 29, 2023

The Nasdaq: A Tough Market to Gauge

November 4, 2022

EQUITIES REMAIN IN “GO” TREND WITH SPARSE LEADERSHIP...

May 28, 2024

Energy-based ETFs Hold Up Despite Weakness in Stocks...

September 9, 2022

Escape the Chaos: Discovering the Key to Tackling...

January 10, 2024

The End is Near!

November 15, 2022

Patience is Key: Waiting for the Pullback to...

August 12, 2023

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Three Years of Sounding the Debt Alarm at Cato and on the Debt Dispatch

      August 27, 2025
    • Trump Administration Rightly Attacks EU Tech Regulations but Tariffs and Censorship at Home Harm Americans 

      August 27, 2025
    • White House demands all Gaza hostages return home ‘this week’ amid stalled talks

      August 27, 2025
    • Bankruptcy, Hell, and Exit Barriers

      August 27, 2025
    • Trump’s DC Death Penalty Crusade Threatens More Tyranny of the Minority

      August 27, 2025
    • Tom Hartley Jnr completes sale of Mansour Ojjeh’s extraordinary McLaren collection

      August 27, 2025

    Categories

    • Business (8,897)
    • Investing (2,246)
    • Politics (16,500)
    • Stocks (3,228)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved