As the earnings season approaches, 71 companies in the S&P 500 have issued negative earnings per share (EPS) guidance for the fourth quarter of 2024, surpassing the five-year average of 56 and the ten-year average of 62. Despite this, seven sectors are expected to report year-over-year earnings growth, with the Financials sector leading the way. Additionally, eight sectors are projected to show year-over-year revenue growth, primarily driven by the Information Technology sector. The forward 12-month price-to-earnings (P/E) ratio for the S&P 500 stands at 21.5, above both the five-year average of 19.7 and the ten-year average of 18.2, while the trailing 12-month P/E ratio is at 27.7, also exceeding historical averages. Notably, the gap between the S&P 500's earnings yield and BBB-rated corporate bond yields has dropped to -1.9%, the lowest level in 15 years, indicating that U.S. stocks may be considered expensive relative to bonds. Analysts predict a 23% EPS growth embedded in stock prices for the next 12 months, though consensus forecasts suggest only an 11.7% growth for Q4 2024, with the 'Magnificent Seven' expected to grow EPS by 22% compared to 8.7% for the remaining companies in the index.