Source: Zhitong Finance

According to Goldman Sachs, the overall profit growth in the US stock market this earnings season will fall on the top ten stocks. Goldman Sachs strategist David Kostin wrote in a report: “Sales of the top 10 companies in the S&P 500 are expected to increase 15% year over year, and earnings per share are expected to increase 32%. In contrast, revenue for the remaining 490 companies is expected to increase by only 2% year over year, and earnings per share change of -4% year over year.”

The consensus forecast for the top ten stocks for the first quarter of 2024 is as follows:

Kostin said: “Failure to meet high growth expectations triggered a decline in the biggest stocks during the peak of the tech bubble. However, the concentration of US stocks has now surpassed the high point during the internet bubble, prompting investors to worry that the largest stocks in this index may be “overtaken”. However, historically, after a period of high concentration, other stocks in the index tend to 'catch up' rather than 'chase down'. If the biggest stocks continue to grow rapidly, the possibility of a sharp 'retracement' is relatively small.”

Looking at the sector, utilities are expected to post the biggest earnings per share increase, which is expected to grow 23% in the first quarter. Goldman Sachs said it is expected$NRG Energy (NRG.US)$und$PG&E Corp (PCG.US)$It will make the biggest contribution to the industry's earnings per share growth. The energy and materials sectors are expected to see the biggest decline, falling 27% and 24% respectively.

“Communications services (22%), information technology (21%), and non-essential consumer goods (14%) are also expected to see strong growth in the first quarter,” Kostin said. The increase was most pronounced in the communications services sector, where the median earnings per share of stocks in this sector are expected to shrink by 3% in the first quarter.”

editor/tolk