Monthly SPDR Sector Scorecard
Jun. 18, 2025
Sector investing is a powerful portfolio construction tool that can enhance your core equity exposure. BMO ETF’s offers 11 BMO SDPR Select Sector Index ETFs in both hedged and unhedged version for Canadian investors:
This monthly sector scorecard provides transparent and quantitative measurements of each sector’s valuation, momentum, and sentiment. The metrics shown are z-scores, which are calculated using the mean and standard deviation of the relevant metrics within S&P 500® sectors and the relevant Select Sector SPDR ETFs manufactured by SSGA are used as a proxy to the S&P500 sectors.
| Monthly Insights | |||
| Sector | Valuation Composite Score | Momentum Composite Score | Earnings Sentiment Composite Score |
| Communication Services | 0.31 | 0.01 | 1.69 |
| Consumer Discretionary | -0.52 | -0.52 | -0.58 |
| Consumer Staples | -0.24 | 1.19 | -0.44 |
| Energy | 0.97 | -1.31 | -1.47 |
| Financials | -0.66 | 0.91 | -0.31 |
| Health Care | 1.22 | -0.3 | 0.58 |
| Industrials | -0.85 | 0.06 | 0.12 |
| Information Technology | -1.33 | -0.45 | 0.8 |
| Materials | 0.16 | -0.94 | 0.12 |
| Real Estate | 0.86 | 0.4 | -0.15 |
| Utilities | 0.31 | 0.94 | -0.37 |
| Source: FactSet, SPDR Americas Research, as of May 31, 2025. Green shading represents top 3, red shading represents bottom 3. Red and green shading are meant to be read vertically. | |||
| Absolute Valuation Composite Score | |||||
| Sector | P/E | NTM P/E | P/B | P/S | Absolute Valuation Composite Score |
| Communication Services | 2.08 | 0.5 | -0.88 | -0.49 | 0.3 |
| Consumer Discretionary | -0.47 | -0.47 | -0.09 | -0.44 | -0.37 |
| Consumer Staples | -1.15 | -1.16 | -0.9 | -0.22 | -0.86 |
| Energy | 1.15 | 0.9 | 1.88 | 1.18 | 1.28 |
| Financials | -0.83 | -1.07 | -0.88 | -0.73 | -0.88 |
| Health Care | 0.78 | 1.24 | 0.73 | 2.73 | 1.37 |
| Industrials | -0.63 | -0.78 | -0.85 | -0.76 | -0.76 |
| Information Technology | -0.92 | -0.75 | -0.74 | -0.61 | -0.76 |
| Materials | -0.47 | -0.7 | 1.33 | -0.08 | 0.02 |
| Real Estate | 1.03 | 1.98 | 1.04 | -0.34 | 0.93 |
| Utilities | 0.58 | 0.3 | -0.66 | -0.22 | 0.00 |
| Source: FactSet, SPDR Americas Research, as of May 31, 2025. Green shading represents top 3, red shading represents bottom 3. Red and green shading are meant to be read vertically. Sector z-score for each metric is calculated across sectors. | |||||
| Relative Valuation Composite Score | |||||
| Sector | P/E | NTM P/E | P/B | P/S | Relative Valuation Composite Score |
| Communication Services | 1.17 | 1.11 | -0.53 | -0.46 | 0.32 |
| Consumer Discretionary | -0.67 | -1.21 | 0.73 | -1.54 | -0.67 |
| Consumer Staples | -0.2 | 0.29 | 0.55 | 0.83 | 0.37 |
| Energy | 0.83 | 0.31 | 0.68 | 0.86 | 0.67 |
| Financials | -0.15 | -0.39 | -1.49 | 0.29 | -0.43 |
| Health Care | 1.17 | 1.11 | 0.92 | 1.09 | 1.07 |
| Industrials | 0.02 | -1.55 | -1.07 | -1.14 | -0.94 |
| Information Technology | -2.4 | -1.53 | -1.92 | -1.76 | -1.9 |
| Materials | -0.28 | -0.12 | 0.84 | 0.78 | 0.31 |
| Real Estate | 0.57 | 1.11 | 0.69 | 0.83 | 0.8 |
| Utilities | 0.77 | 0.87 | 0.6 | 0.22 | 0.62 |
| Source: FactSet, SPDR Americas Research, as of May 31, 2025. Green shading represents top 3, red shading represents bottom 3. Red and green shading are meant to be read vertically. Sector z-score for each metric is calculated across sectors. | |||||
| Momentum Composite Score | ||||
| Sector | 3 Months | 6 Months | 12 Months | Momentum Composite Score |
| Communication Services | -1.14 | 0.48 | 0.7 | 0.01 |
| Consumer Discretionary | -1.96 | 0.23 | 0.18 | -0.52 |
| Consumer Staples | 1.57 | 1.66 | 0.33 | 1.19 |
| Energy | -0.65 | -1.06 | -2.2 | -1.31 |
| Financials | 0.07 | 1.46 | 1.21 | 0.91 |
| Health Care | 0.27 | -0.32 | -0.84 | -0.3 |
| Industrials | 0.08 | 0.14 | -0.05 | 0.06 |
| Information Technology | -0.55 | -1.25 | 0.43 | -0.45 |
| Materials | 0.06 | -1.51 | -1.36 | -0.94 |
| Real Estate | 1.08 | -0.51 | 0.63 | 0.4 |
| Utilities | 1.17 | 0.69 | 0.96 | 0.94 |
| Source: Bloomberg Finance L.P., SPDR Americas Research, as of May 31, 2025. Green shading represents top 3, red shading represents bottom 3. Red and green shading are meant to be read vertically. Sector z-score for each metric is calculated across sectors. | ||||
| Sentiment Composite Score | |||||
| Sector | 3-Month Change to 2025 EPS Est. | 2025 EPS Est. | Current Earnings Season | Sentiment Composite Score | |
| Upgrade-to- Downgrade Ratio | Magnitude of Earnings Surprise | % of Companies with Earnings Beats | |||
| Communication Services | 1.32 | 1.42 | 2.88 | 1.15 | 1.69 |
| Consumer Discretionary | -0.5 | -1.14 | 0.24 | -0.92 | -0.58 |
| Consumer Staples | 0.31 | -0.95 | -0.73 | -0.41 | -0.44 |
| Energy | -2.69 | -1.38 | -0.89 | -0.9 | -1.47 |
| Financials | 0.31 | -0.96 | -0.28 | -0.31 | -0.31 |
| Health Care | 0.08 | 0.54 | 0.2 | 1.49 | 0.58 |
| Industrials | -0.17 | -0.15 | 0.05 | 0.76 | 0.12 |
| Information Technology | 0.44 | 1.62 | -0.26 | 1.42 | 0.8 |
| Materials | 0.71 | -0.12 | 0.26 | -0.37 | 0.12 |
| Real Estate | -0.54 | 0.98 | -0.79 | -0.25 | -0.15 |
| Utilities | 0.72 | 0.15 | -0.69 | -1.66 | -0.37 |
| Source: FactSet, SPDR Americas Research, as of May 31, 2025. Green shading represents top 3, red shading represents bottom 3. Red and green shading are meant to be read vertically. Sector z-score for each metric is calculated across sectors. | |||||
Z-scores are calculated using the mean and standard deviation of the relevant metrics within S&P 500 sectors. Using z-scores to standardize results across all sectors allows for easier relative assessment. Sectors with cheaper valuation, higher price momentum, higher sentiment and higher volatility will have higher z-scores.
We calculate a composite score by equally weighting each metric z-score in the same category.
The scorecard does not represent the investment views of State Street. Metrics used in the scorecard have not been backtested for any sector strategies by State Street. These are for illustrative and educational purposes, as we seek to bring greater transparency to the sector-investing landscape and the due diligence required to build sophisticated portfolios to meet specific client objectives.
Value Stocks that trade at a lower price relative to their fundamentals may outperform high-valuation sectors
Momentum Stocks that have performed well may tend to continue doing well in the near term
Earnings sentiment Stocks with strong earnings sentiment may indicate improving earnings growth prospects in the near term
Volatility Realized volatility provides an insight on the sector historical volatility levels, while implied volatility indicates forward-looking risk levels examined the percentile ranking of sector trailing price-to- earnings (P/E), next-12-month price-to-earnings (NTM P/E), price-to-book (P/B) and price-to-sales (P/S) over the past 15 years. A higher score indicates more attractive valuations at present relative to the sector’s historical norm.
The Momentum Composite Score is calculated by combining recent — (not including the most recent month) 3-months, 6-months and 12-months — price performance of the sector. A higher score indicates higher price momentum. To calculate the Sentiment Composite Score, we examined changes to the NTM EPS estimates over the prior three months, the EPS upgrade-to-downgrade ratio, and the magnitude and breadth of earnings beats in the current earnings season. A higher score indicates higher earnings sentiment in the sector.
Glossary
Implied Volatility (IV) is measured by the 3-month at-the-money implied volatility for options tied to the corresponding Select Sector SPDR ETFs. It represents the market’s
forward-looking expectation of volatility based on current options pricing.
NTM Price-to-Earnings Ratio (NTM P/E) The ratio of the price of a stock and the firms earnings per share over the next 12 months. A lower NTM P/E indicates cheaper valuation.
Price-to-Book Ratio (P/B) A financial ratio used to compare a company’s current market price to its book value which is the carrying value of an asset according to its balance sheet account balance. A lower P/B indicates cheaper valuation.
Price-to-Earnings Ratio (P/E) The ratio of the price of a stock and the firms earnings per share. A lower P/E indicates cheaper valuation.
Price-to-Sales Ratio (P/S) The ratio of the price of a stock and the firms sales per share. A lower P/S indicates cheaper valuation.
Z-score measures how many standard deviations an element is above or below the population mean. A sector z-score can be calculated from the following formula.
z = (X - μ)/σ, where X is the sector value of the metrics, μ is the mean of 11 sector values for a certain metric, and σ is the standard deviation of the value of 11 sectors.
Disclaimers
Advisor Use Only
This document has been sourced from State Street Global Advisors. The views expressed in this material are the views of SPDR Americas Research Team through the period ended February 28, 2025 and are subject to change based on market and other conditions and do not necessarily represent the views of BMO Global Asset Management, State Street Global Advisors or any of its affiliates.
This material is for information purposes only. The information contained herein is not, and should not be construed as investment, tax or legal advice to any party. Particular investments and/or trading strategies should be evaluated and professional advice should be obtained with respect to any circumstance.
Any statement that necessarily depends on future events may be a forward-looking statement. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Although such statements are based on assumptions that are believed to be reasonable, there can be no assurance that actual results will not differ materially from expectations. Investors are cautioned not to rely unduly on any forward-looking statements.
Investing involves risk, including the risk of loss of principal.
Because of their narrow focus, sector funds tend to be more volatile than funds that diversify across many sectors and companies. Select Sector SPDR Funds bear higher level of risk than more broadly diversified funds.
All ETFs are subject to risk, including possible loss of principal. Sector ETF products are also subject to sector risk and non-diversification risk, which generally result in greater price fluctuations than the overall market.
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