Technology investors may be selling because they’re not thrilled with what they’re seeing in terms of 2021 earnings growth expectations from the sector.
Taking Apple as the poster child for the high-flying group, you might think that as the share price soars, so too are EPS growth forecasts from analysts. Alas, that’s not the case. Apple’s expected 19% increase in the bottom-line has been stagnant for weeks. The broader S&P Technology sector has also flat-lined. Calendar 2021 EPS are seen growing by 15.7%, little different from 16.2% a month ago and a step down from 16.8% two months ago.
The good times for technology sales may be peaking right about now. DataTrek Research’s Nick Colas points out that the industry has just gone through the “largest global upgrade cycle since the dawn of personal computing.” With an expected life-span of several years, demand might stagnate or decline from here even if work-from-home continues.
Taking Apple as the poster child for the high-flying group, you might think that as the share price soars, so too are EPS growth forecasts from analysts. Alas, that’s not the case. Apple’s expected 19% increase in the bottom-line has been stagnant for weeks. The broader S&P Technology sector has also flat-lined. Calendar 2021 EPS are seen growing by 15.7%, little different from 16.2% a month ago and a step down from 16.8% two months ago.
The good times for technology sales may be peaking right about now. DataTrek Research’s Nick Colas points out that the industry has just gone through the “largest global upgrade cycle since the dawn of personal computing.” With an expected life-span of several years, demand might stagnate or decline from here even if work-from-home continues.