In February, the S&P 500 declined 0.9 per cent.
Last month, seven sectors delivered positive returns while four sectors reported negative price returns. Sectors with the highest price returns were utilities, energy, materials, consumer staples, industrials and real estate with gains of 9.9 per cent, 8.8 per cent, 8.3 per cent, 7.9 per cent, 7 per cent and 6.2 per cent, respectively. Leading sector detractors were consumer discretionary and communication services with losses of 5.4 per cent, 5.1 per cent, respectively.
The top 10 performers in the S&P 500 Index in February were:
- Texas Pacific Land (TPL-N), up 51 per cent
- Corning (GLW-N), up 46 per cent
- DaVita (DVA-N), up 43 per cent
- Keysight Technologies (KEYS-N), up 42 per cent
- Ciena (CIEN-N), up 38 per cent
- Generac Holdings (GNRC-N), up 34 per cent
- Teradyne (TER-Q), up 33 per cent
- Qnity Electronics (Q-N), up 32 per cent
- Dell Technologies (DELL-N), up 29 per cent
- Howmet Aerospace (HWM-N), up 26 per cent
The fourth-quarter earnings was solid. According to a report from LSEG published on March 6, of the 491 companies in the S&P 500 that have reported their quarterly results, 73 per cent delivered better-than-expected results, which is higher than the long-term average of 67 per cent. Year-over-year earnings growth for the fourth quarter is 14.1 per cent, down from 14.9 per cent reported in the third quarter. The technology sector has the highest growth rate with earnings expected to grow 34 per cent year-over-year.
Earnings growth is expected to gain momentum. Year-over-year earnings growth is anticipated to come in at 15.9 per cent in 2026, up from 14.2 per cent forecast in 2025. Year-over-year earnings growth is forecast to expand 12.8 per cent in the first quarter of 2026, 16.1 per cent in the second quarter of 2026, 17 per cent in the third quarter, 16.3 per cent in the fourth quarter of 2026 and 20.2 per cent in the first quarter of 2027.
According to LSEG, the forward four-quarter price-to-earnings multiple for the S&P 500 stood at 21.6 times, down from 22.3 times as of Jan. 30.
Now, here’s a look at analysts’ target prices, recommendations, forecast returns and yields for all securities in the S&P 500 grouped by sector and ranked according to their expected price returns (excluding dividend and distribution income).
The posted target price for each security is an average of all available target prices from analysts. A target price typically reflects an expected share or unit price 12 months from now based on an analyst’s financial modelling, such as a discounted cash flow or sum-of-the-parts model.
Data is as of Fri. Feb. 27.
It’s important to note that high target prices, which imply stellar returns that seem unbelievable may be just that - unrealistic. At times, when a stock price falls analysts may maintain their bullish expectations, inflating the forecast return. In addition, an outlier (extreme target price) can skew the average target price, to the upside or downside, particularly when the number of analysts covering a stock is low. Don’t let a huge projected gain lure you into a position – it is critical to look at the company and industry fundamentals.
Click here to download an Excel version of the report.
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