Earnings and Sales Growth
While tariffs have impacted estimates, the absolute rates of 2025 EPS growth in the Developed Markets (8.1%) and Emerging Markets (11.1%) are still firmly positive. Forecasted sales growth has demonstrated greater stability this period. Emerging Asia currently has the highest estimates for both top and bottom lines, from a region perspective, with South Korea expected to grow earnings per share at the median company by 22.1% despite a more moderate 6.6% anticipated sales growth due to strength in technology.
Earnings Expectation Trends
Particularly in Europe, expectations have declined with American tariffs in one form or another set to be in place, as the United States exerts its influence as the global hegemon. European nations such as France (-5.0% Q/Q) and the Netherlands(-3.1% Q/Q) have 2025 forecasted earnings which have shifted downward as worldwide trade dynamics are being re-sorted.Notably, the Scandinavian countries such as Sweden (+2.3% Q/Q) did not experience negative trajectory and actually had an increase in positive sentiment at the median company. Interestingly, Mexico (+2.7% Q/Q) seems to have not been as affected yet by news of tariffs while Canada (-1.4% Q/Q) looks to have already felt at least some of the effects. Earnings estimates for the Emerging Asia region are down marginally -0.6% Q/Q, despite positive revisions in China and South Korea,with India down -1.8% Q/Q and negative sentiment change seen in Southeast Asian countries as well.
1: Change in the median growth rate of each region/country compared to the median of last quarter. 2: EMEA: Europe, Middle East and Africa; Source: Refinitiv Financial; MSCI; Smith Asset Management Group. Data as of Mar. 31, 2025; Values calculated using median estimates; Returns include dividends reinvested. Past performance is not indicative of future results. As with any investment vehicle, there is always a potential for profit as well as the possibility of loss. Nothing contained in this presentation should be construed as a recommendation to buy or sell a security or economic sector.