Tech Stocks Become Cheaper Than the S&P 500 for First Time Since 2017 as Nvidia Earnings Approach
Technology stocks are trading at a lower valuation than the rest of the S&P 500 for the first time since 2017, marking a significant shift in the relationship between the sector and the broader U.S. equity market. According to figures shared by Coin Bureau, technology stocks that traded above 32 times expected earnings a year ago are now valued at approximately 17 times forward earnings.
The valuation decline comes alongside strong reported earnings growth in the technology sector. Coin Bureau said tech company profits are growing 69% this quarter, substantially outpacing the broader earnings growth figures cited for the S&P 500.
For investors assessing relative market valuations, the comparison suggests that the technology sector has become considerably less expensive despite maintaining stronger reported profit growth. The change is particularly notable because technology stocks have historically commanded higher earnings multiples than many other sectors within the S&P 500.
S&P 500 Earnings Growth Outpaces Index Performance
The figures shared by Coin Bureau also highlight a gap between projected corporate earnings and stock market performance. Expected profits across the entire S&P 500 are up 33.6% this year, while the benchmark index has gained just 7.4%, according to the figures cited in the post.
The comparison places the technology sector's reported 69% profit growth this quarter against broader expectations for corporate earnings across the U.S. markets. Meanwhile, the decline in technology valuations from above 32 times expected earnings to approximately 17 times suggests a substantial change in how investors are pricing the sector's future profitability.
However, the figures alone do not establish why technology valuations have declined or whether the current earnings multiples represent a lasting change in market conditions. They instead illustrate the contrast between reported profit growth and the valuations investors are currently assigning to technology companies.
Nvidia Earnings Set to Test Technology Sector Valuations
The next significant event identified by Coin Bureau is November 17, when Nvidia is scheduled to report its earnings. The post describes the upcoming report as the company's first earnings announcement without Jensen Huang, making the leadership-related claim an additional point of attention surrounding the event.
Nvidia's results will provide another set of financial figures for investors assessing the performance and earnings outlook of the technology sector. The announcement comes as technology stocks trade at approximately 17 times expected earnings, compared with more than 32 times a year earlier.
For now, the central figures in Coin Bureau's assessment are the technology sector's 69% profit growth this quarter, the S&P 500's 33.6% expected profit increase this year, and the benchmark index's 7.4% gain. Together, they frame the valuation shift ahead of Nvidia's November 17 earnings announcement.
Writer: Victoria HaleTechnology & Blockchain WriterVictoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.She prioritises clarity and accuracy when explaining technical developments to a general audience.
Check out other news and articles on Google News
Disclaimer:
The articles on Hokanews are here to keep you updated on the latest buzz in crypto, tech, and beyond—but they’re not financial advice. We’re sharing info, trends, and insights, not telling you to buy, sell, or invest. Always do your own homework before making any money moves.
Hokanews isn’t responsible for any losses, gains, or chaos that might happen if you act on what you read here. Investment decisions should come from your own research—and, ideally, guidance from a qualified financial advisor. Remember: crypto and tech move fast, info changes in a blink, and while we aim for accuracy, we can’t promise it’s 100% complete or up-to-date.