[RT] S&P PE and Earnings

[Pete Lieber <plieber@xxxxxxxxxxxxxx>]

Standard and Poor's recently released preliminary 4th Quarter 2008 SP-500 earnings.  As most of you no doubt have read it was the first negative earnings quarter in S&P history.  With over 93% of all 500 companies reporting, the 4th quarter earnings are -$11.97.  For the year reported earnings are $26.16 compared to $45.95 for the previous 4 quarters (12/31/07 to 9/30/08).  This in effect jumped the S&P's PE up from 17.99 for the week ending 1/13/09 to its current PE of 29.24 (S&P's close of 764.90 / $26.16).  However, according to S&P's estimates the 4-quarter earnings for the next 4 periods will be:
3/31/09 - $18.48
6/30/09 - $14.37
9/30/09 - $12.62
12/31/09 - $32.41

Demonstrating all this are two attached S&P PE charts - one for 1939 to present and the other 1985 to present.

Last time the S&P had earning below $19, the S&P index was below 420.  On the other hand, back in June 2002 the S&P had earnings of $30.32 and the S&P stood at 989.81. 

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Attachment: SP PE 1936-2009.gif
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Attachment: SP PE 1985-2009.gif
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