Looking for some truly "wow factor" profit growth from S&P 500 companies? A few are likely to knock your socks off.
Eight companies in the S&P 500 — including Merck, Seagate Technology and KeyCorp — are expected to post fourth-quarter adjusted EPS growth of 200% or more, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSurge.
These are likely to be some of the standouts in the quarterly earnings season, which is soon to kick off. And the fourth quarter's profit is pivotal at this point in the market's rally.
"Indeed, these robust economic figures incrementally lead to a more apprehensive Federal Reserve, closing the door to further valuation expansion and placing the burden on corporate earnings," said Jose Torres, senior economist at Interactive Brokers.
Blowing The Profit Top Off
Drugmaker Merck is expected to deliver the highest profit growth in the quarter. Analysts think its adjusted EPS will rise 5,927% in the quarter. That's higher than any other S&P 500 member is seen doing. Shares are up 1.5% this year so far.
Showing just how much of a standout that is, take a look at profit growth forecasts for the entire S&P 500. Analysts think the S&P 500 at large will report nearly 12% higher profit in the fourth quarter, says FactSet. And that's the highest quarterly profit growth since 2021.
Merck investors, however, aren't impressed yet. The stock carries a low RS Rating of just 17.
Other Big S&P 500 Growers
Computer storage provider Seagate's shares are already up 3.8% this year. Analysts think the company's profit per share will rise 1,462% this year. Like Merck, though, shares haven't performed well longer term. The stock sports an RS Rating of just 25. And Seagate's Composite Rating is only 46.
In the financial sector, KeyCorp is seen putting up some big numbers. The bank is expected to post adjusted profit growth of 987% in the fourth quarter. Shares are up 0.3% this year.
So, it's likely going to be a strong quarter for the S&P 500. And some stocks will likely find a way to still impress investors.
Big Fourth-Quarter 2024 S&P 500 Growth
Based on estimates
| Company | Ticker | EPS growth | Sector |
|---|---|---|---|
| Merck | MRK | 5,927.3% | Health Care |
| Seagate Technology | STX | 1,461.5% | Information Technology |
| KeyCorp | KEY | 987.1% | Financials |
| American Tower | AMT | 648.5% | Real Estate |
| Pfizer | PFE | 363.2% | Health Care |
| Paramount Global | PARA | 284.7% | Communication Services |
| Digital Realty Trust | DLR | 211.0% | Real Estate |
| SBA Communications | SBAC | 206.1% | Real Estate |
