{"id":22124,"date":"2012-11-30T13:15:03","date_gmt":"2012-11-30T18:15:03","guid":{"rendered":"http:\/\/www.thedisciplinedinvestor.com\/blog\/?p=22124"},"modified":"2012-11-30T13:15:03","modified_gmt":"2012-11-30T18:15:03","slug":"report-sp-earnings-and-sales-growth-spread-something-has-gotta-give-2","status":"publish","type":"post","link":"https:\/\/thedisciplinedinvestor.com\/blog\/2012\/11\/30\/report-sp-earnings-and-sales-growth-spread-something-has-gotta-give-2\/","title":{"rendered":"Report: S&#038;P Earnings and Sales Growth Spread (Something Has Gotta Give)"},"content":{"rendered":"<p>Sales and earnings are the basic components of a company\u2018s profitability. As sales move up and down, a company can adapt their expenses to meet the net earnings requirements in order to preserve profitability. However, there is only so much a company can cut. Eventually, something has got to give.<\/p>\n<p>Looking at the historical spread between quarterly earnings growth (year over year) and sales growth there is a good correlation to the price of the S&amp;P 500, two quarters into the future. As spreads decline, it is a <!--more-->sign that sales growth is no longer keeping up with the pace of earnings growth and investors will re-price stocks.<\/p>\n<p>Looking at the current and estimated spread shows that there is a significant gap building. In fact, analysts estimate that earnings growth will continue to increase at a healthy pace while sales growth stagnates. There are a few outcomes which are possible:<\/p>\n<p><strong>To receive the full report, enter info and click DOWNLOAD:<\/strong><br \/>\n<script type=\"text\/javascript\">\n\/* <![CDATA[ *\/\nvar gform;gform||(document.addEventListener(\"gform_main_scripts_loaded\",function(){gform.scriptsLoaded=!0}),document.addEventListener(\"gform\/theme\/scripts_loaded\",function(){gform.themeScriptsLoaded=!0}),window.addEventListener(\"DOMContentLoaded\",function(){gform.domLoaded=!0}),gform={domLoaded:!1,scriptsLoaded:!1,themeScriptsLoaded:!1,isFormEditor:()=>\"function\"==typeof InitializeEditor,callIfLoaded:function(o){return!(!gform.domLoaded||!gform.scriptsLoaded||!gform.themeScriptsLoaded&&!gform.isFormEditor()||(gform.isFormEditor()&&console.warn(\"The use of gform.initializeOnLoaded() is deprecated in the form editor context and will be removed in Gravity Forms 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As sales move up and down, a company can adapt their expenses to meet the net earnings requirements in order to preserve profitability. However, there is only so much a company can cut. Eventually, something has got to give. Looking at the historical spread [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[12,42],"tags":[490],"class_list":["post-22124","post","type-post","status-publish","format-standard","hentry","category-markets","category-stocks","tag-stocks","et-doesnt-have-format-content","et_post_format-et-post-format-standard"],"acf":[],"_links":{"self":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/22124","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/comments?post=22124"}],"version-history":[{"count":0,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/posts\/22124\/revisions"}],"wp:attachment":[{"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/media?parent=22124"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/categories?post=22124"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thedisciplinedinvestor.com\/blog\/wp-json\/wp\/v2\/tags?post=22124"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}