Featured Image

S&P 500 Reporting Higher Net Profit Margin Quarter-Over-Quarter for Q1

Earnings

By John Butters  |  April 29, 2024

Given continuing concerns in the market about inflation, what is the S&P 500 reporting for a net profit margin for Q1?

The (blended) net profit margin for the S&P 500 for Q1 2024 is 11.5%, which is in line with the year-ago net profit margin and the 5-year average, but above the previous quarter’s net profit margin.

At the sector level, six sectors are reporting a year-over-year increase in their net profit margins in Q1 2024 compared to Q1 2023, led by the Information Technology (25.5% vs. 22.4%), Utilities (13.4% vs. 10.3%), and Communication Services (13.5% vs. 10.9%) sectors. On the other hand, five sectors are reporting a year-over-year decrease in their net profit margins in Q1 2024 compared to Q1 2023, led by the Health Care (6.3% vs. 9.3%) and Energy (9.6% vs. 12.5%) sectors.

Six sectors are reporting net profit margins in Q1 2024 that are above their 5-year averages, led by the Information Technology (25.5% vs. 23.4%) and Communication Services (13.5% vs. 11.5%) sectors. On the other hand, five sectors are reporting net profit margins in Q1 2024 that are below their 5-year averages, led by the Health Care (6.3% vs. 10.0%) and Materials (9.1% vs. 10.9%) sectors.

Five sectors are reporting a quarter-over-quarter increase in their net profit margins in Q1 2024 compared to Q4 2023, led by the Financials (17.7% vs. 13.1%) sector. On the other hand, six sectors are reporting a quarter-over-quarter decrease net profit margins in Q1 2024 compared to Q4 2023, led by Health Care (6.3% vs. 7.4%), Energy (9.6% vs. 10.7%), and Information Technology (25.5% vs. 26.5%) sectors.

It is interesting to note that analysts believe net profit margins for the S&P 500 will be above 12.0% for the rest of 2024. As of today, the estimated net profit margins for Q2 2024, Q3 2024, and Q4 2024 are 12.2%, 12.6%, and 12.5%, respectively.

01-s&p-500-net-profit-margin-q119-q124

02-s&p-500-sector-level-net-profit-margins-q124-versus-q123

03-s&p-500-sector-level-net-profit-margins-q124-vs-5-year-average

04-s&p-500-sector-level-net-profit-margins-q124-versus-q423

 

This blog post is for informational purposes only. The information contained in this blog post is not legal, tax, or investment advice. FactSet does not endorse or recommend any investments and assumes no liability for any consequence relating directly or indirectly to any action or inaction taken based on the information contained in this article.

Download the latest Earnings Insight

John Butters

Vice President, Senior Earnings Analyst

Mr. John Butters is Vice President and Senior Earnings Analyst at FactSet. His weekly research report, “Earnings Insight,” provides analysis and commentary on trends in corporate earnings data for the S&P 500 including revisions to estimates, year-over-year growth, performance relative to expectations, and valuations. He is a widely used source for the media and has appeared on CNBC, Fox Business News, and the Business News Network. In addition, he has been cited by numerous print and online publications such as The Wall Street Journal, The Financial Times, The New York Times, MarketWatch, and Yahoo! Finance. Mr. Butters has over 15 years of experience in the financial services industry. Prior to FactSet in January 2011, he worked for more than 10 years at Thomson Reuters (Thomson Financial), most recently as Director of U.S. Earnings Research (2007-2010).

Comments

The information contained in this article is not investment advice. FactSet does not endorse or recommend any investments and assumes no liability for any consequence relating directly or indirectly to any action or inaction taken based on the information contained in this article.