Good news for stock-market bulls: Corporate earnings growth is no longer being driven just by tech
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- S&P 500 companies are beating Wall Street's EPS estimates by an average of 8%, with 80% of the index having reported earnings so far this season
- S&P 500 earnings are on track to grow roughly 30% from the same period a year ago, which would mark the fastest pace since the fourth quarter of 2021
- Wells Fargo Securities says the broadening earnings picture particularly benefits industrial, financial, and technology firms
- The AI investment boom is beginning to spread into the broader economy, a shift now showing up in analysts' earnings forecasts across sectors
- Wells Fargo characterized the season as on track to be a 'blowout,' based on the aggregate beat rate and year-over-year growth trajectory
Why it matters: With roughly 30% YoY EPS growth — the fastest since Q4 2021 — and the beat rate spreading to industrial and financial firms, the bull case gets a broader foundation rather than relying solely on mega-cap tech. Investors concentrated in non-tech sectors gain evidence that AI-driven capex is generating spillover demand, while the 8% average EPS beat versus estimates signals upside surprises rather than analyst models already pricing in optimism.
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