The SPDR S&P 500 ETF Trust (NYSE:SPY) recently hit its lowest level of 2022 this week despite overall first-quarter earnings numbers that are relatively solid. Unfortunately, Bank of America analyst Savita Subramanian said overall S&P 500 earnings numbers for the first quarter aren't as strong as they may seem at first glance, and the index is experiencing a "death by paper cuts."
The Numbers: Subramanian said S&P 500 EPS is up 11% year-over-year, exceeding consensus estimates by about 6% on the quarter. However, she said guidance updates this quarter have been the worst since the COVID-19 pandemic hit in the second quarter of 2020. As a result, Subramanian said the S&P 500 is at a high risk of significantly missing full-year consensus ESP estimates of $251. Bank of America is projecting just $230 in 2022 S&P 500 EPS with a downside of around $200 if the U.S. economy falls into a recession.
