Market Correction "Near Guaranteed" Given Insanely High Earnings Expectations

President & Co-Founder at Peak Prosperity • Feb 23, 2025 at 11:09 AM EST

Earnings estimates currently forecasted for 2025 are so far removed from what actual corporate profits will be able to deliver that a downwards repricing event is highly likely.

Ipad, Online, Tablet, Internet, Screen, Digital

Image Source: Pixabay

"It's almost a guaranteed setup for a mean-reverting event"

That's how portfolio manager Lance Roberts views the extremely-rosy earnings estimates currently forecasted for 2025 are.

In his estimation, these estimates are so far removed from what actual corporate profits will be able to deliver that a downwards repricing event is highly likely.

The critical question, of course, remains: When?

Lance and I discuss this unrealistic estimates threat in depth, as well as Walmarts (WMT) recent disappointment, the continued weakening of the US consumer, shifting investor & CEO confidence, gold, bonds, DOGE, tariffs, inflation, and Lance's firm's latest trades in this week's Market Recap.

Video Length: 01:46:44

More By This Author:

Stocks Likely To Run Even Higher Before The Top Is In
Will A Market Correction Trigger A Recession?
Overly Bullish Investors Risk Losing Up To 40% This Year

Disclosure:

Thoughtful Money LLC is in the application process to be a Registered Investment Advisor Solicitor. We produce educational content geared for the individual investor. It’s important to note that this content is NOT investment advice, individual or otherwise, nor should be construed as such. We recommend that most investors, especially if inexperienced, should consider benefiting from the direction and guidance of a qualified financial advisor in good standing with the Financial Industry Regulatory Authority (FINRA) who can develop & implement a personalized financial plan based on a customer’s unique goals, needs & risk tolerance. IMPORTANT NOTE: There are risks associated with investing in securities. Investing in stocks, bonds, exchange traded funds, mutual funds, and money market funds involve risk of loss. Loss of principal is possible. Some high risk investments may use leverage, which will accentuate gains & losses. Foreign investing involves special risks, including a greater volatility and political, economic and currency risks and differences in accounting methods. A security’s or a firm’s past investment performance is not a guarantee or predictor of future investment performance.