April 14, 2025 Investor Insights

Inflation Expectations

April 14, 2025

Enjoy this week's "Investor Insights," a weekly newsletter that highlights the financial news you need and provides tips and tricks for making better investment decisions. 

• Americans now expect inflation to reach 6.7% next year, the highest since 1981. This is up from 5.0% in March and marks the fourth consecutive month of significant increases. 1
• There are 69 companies in the S&P 500 that have raised their dividends for 25 years or more. In five recent market crises (1), the average peak-to-trough decline for the S&P 500 was roughly 40%, while these “dividend aristocrats” only fell about 25%. *2
• Apple stock has dropped 25.5% this year, and its forward price-to-earnings ratio is now less than 25x. Historically, Apple's stock price has increased an average of 17% over the twelve months following a PE compression of less than 25x. *3
• U.S. tariffs on China have increased to 145%, while China's tariffs on U.S. goods will rise to 125%. This will inevitably decrease the amount of imports from China, which accounted for around 13% of all U.S. goods imports in 2024. 4

Sources:

1. WSJ - "Consumer Inflation Expectations Hit Highest Since 1981"
2. Barrons - "Why Dividend Stocks Like Coca-Cola and Caterpillar Are the Ones to Buy in Periods of Market Turmoil"
3. Barrons - "Apple Stock's Resilience Means This Is an Opportunity, Says BofA. Plus, Meta, Occidental, and More."
4. WSJ - "The U.S. and China Are Going to Economic War-and Everyone Will Suffer"

1) The five market crises include the dot-com bust, the 2008-09 financial crisis, the 2011 federal debt ceiling standoff, COVID-19, and the 2022 interest-rate hike cycle. 

*Past performance is not indicative of future performance

Disclosure: This information is furnished for the use of Glen Eagle Advisors, LLC, Glen Eagle Wealth, LLC, and their clients and/or contacts. It does not constitute the provision of investment advice to any person. It is not prepared with respect to the specific objectives, financial situation, or particular needs of any specific person. Investors reading this commentary should consult with their Glen Eagle representative/financial advisor regarding the appropriateness of investing in any securities or adapting any investment strategies discussed or recommended in this newsletter. 

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