Bank of America analysts on Tuesday raised their 2024 S&P 500 earnings per share

Bank of America analysts on Tuesday raised their 2024 S&P 500 earnings per share (EPS) estimates to $250 from $235 previously.

The new estimate is Wall Street’s highest estimate above and indicates an increase of approximately 12% year-on-year (y-o-y).

  • Businesses performed better in the fourth quarter and our researchers increased their 2024 GDP forecast to 2.7% on an annualized basis (year after year). In a report released Tuesday, experts noted a 1.4% increase in November.

— All else being equal, the 1.3 percentage point GDP growth forecast will offset 5 percentage points of EPS growth. They added that 2023 will be a year of change for American companies as the economy now adapts to a new environment of higher interest rates and stagnant demand.

Bank of America said its senior system saw earnings per share rise 3 percent​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​’fall down Although it should close in 2024. >
They also presented an estimate of their earnings for 2025, which they pegged at $275.

The bank expects so-called hyperscalers, including Microsoft, Amazon, Text and Meta, to allocate $180 billion invested in 2024, up 27 percent last year.

Annual capital expenditure of US$38 billion accounts for approximately 80% of the revenue expected in the previous year, indicating that these companies are entering a period of declining return on capital.

-History shows that companies’ returns on investment are not good, but experts point out that we are seeing a positive cycle in artificial intelligence (AI) investments.

— Semiconductors and networking are the main beneficiaries, but increasing energy consumption and the physical development of data centers will affect electricity, energy consumption, equipment, etc. They added that it would increase further demand for

—Increasing productivity through artificial intelligence and domestic investment are also key factors.

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