Editor's Note: Below is an excerpt and chart from this morning's Early Look market note.

There isn’t a “valuation” bear on Wall Street who was calling for year-over-year Tech EPS growth of 20-25% while they were whining about Trump 14 months ago. Newsflash: Trump didn’t drive the Tech earnings cycle – negative year-over-year compares did!

As you can see in today’s Chart of The Day where we’re showing you the year-over-year SALES and EPS growth rates by SP500 Sector Style, by Q3 of 2017 year-over-year Tech earnings growth peaked at +23.7% growth.

How do we know that was the peak?

  1. We don’t, for sure, yet – anything can happen… and we are data dependent so we’ll change if the data does… but
  2. 65 of the 67 “Tech” companies in the SP500 have reported year-over-year EPS growth of +22.5%

So, unless the last 2 Tech companies jack the aggregate year-over-year growth rate over +23.7%, the current peak of the Tech Earnings Cycle may very well be in, baby!

Why?

  1. Base effects get materially “tougher” in the coming quarter
  2. For Q1 of 2018, Tech has to “comp” a +21.7% year-over-year growth rate 

CHART OF THE DAY: A Peak In Tech Earnings? - 03.06.18 EL Chart