by Lance Roberts
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| This earnings season have been exceptionally strong, with growth, margins, and beat rates well above historical norms. But the strength is highly concentrated in a small group of mega-cap tech $GOOGL $AMZN $MSFT $META $AAPL $NVDA and semiconductor names like $AVGO, not the broader market. At the same time, analysts are raising forward estimates into the next earnings season, which is unusual and signals rising optimism. The problem is that the macro backdrop doesn’t support it. Consumers are under pressure from high costs (including gasoline as a result of higher price of #crudeoil), weak savings, and rising credit usage, while wages lag inflation. Since consumption drives the majority of the economy (~70%), this creates a growing disconnect. So, stay with the trend (it’s still strong), but don’t assume this level of earnings growth is sustainable. Also watch consumer health + credit + savings closely and pay attention to breadth (is it still just a few stocks?) Because when this kind of setup breaks, it doesn’t usually give a polite warning. 📺Full episode: Catch me daily on The Real Investment Show: https://www.youtube.com/@TheRealInvestmentShow |
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