By contrast, analysts expect a 5.8% increase in 2025 revenue, according to data compiled by Bloomberg Intelligence.
The median analyst forecast “for a sharp acceleration in sales growth appears slightly too optimistic”, Kostin wrote in a note dated Aug 16.
S&P 500 companies are on track to post the sharpest increase in quarterly earnings since 2021, data compiled by Bloomberg Intelligence show. At the same time, the share of firms beating sales estimates in the second quarter is the smallest since 2019, raising concerns about the resilience of profit margins.
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Kostin still sees margins expanding next year, as a slowdown in price increases has been countered by easing cost pressures, including wages. Still, the strategist said margins are unlikely to expand as much as analysts expect.
Morgan Stanley strategist Michael Wilson, meanwhile, has warned about a shorter-term weakening in the earnings outlook, in line with the seasonal trend.
Chart: Bloomberg
