Tom Lee: S&P 500 valuations are becoming cheap, Q3 earnings growth may approach 30%.

October 7 — Tom Lee, chairman of Ethereum treasury company BitMine, said that despite recent cautious market performance, the fundamentals of the S&P 500 are improving and index valuations have actually declined. Fundstrat expects that third-quarter earnings growth for S&P 500 constituents could be close to 30%, and the 2027 earnings per share (EPS) forecast has been raised by more than 20% since the beginning of the year.

Tom Lee pointed out that the S&P 500's gain is lower than the upward revision in earnings expectations, meaning the market's valuation multiple is actually declining. He also believes that high oil prices may strengthen the U.S. economy through American energy exports, while the leading performance of tech stocks and the crypto market indicates that the market is betting on weaker inflation in the future.