EPS growth benchmark · 12 sectors
EPS Growth Rate by Industry and Sector: 2025 Benchmarks
EPS growth is more volatile than revenue growth — amplified by operating leverage, buybacks, and one-time items — but it is the number that most directly drives valuation multiples and PE re-rating. Technology leads at a 15-25% median; Utilities and Consumer Staples grow 4-5% and are healthy doing so. This table shows the median, 25th percentile, and 75th percentile year-over-year EPS growth for 12 sectors, so you can benchmark any company against its industry peers. Screen for the fastest and slowest earners with the EPS Growth Screener.
2024 data · 12 sectors
EPS Growth Rate Benchmarks by Sector
| Sector | Median EPS Growth | Low (25th pct) | High (75th pct) | YoY Trend Note |
|---|---|---|---|---|
| Technology | 18% | 8% | 32% | AI infrastructure buildout, cloud margin expansion, and buybacks combine to drive the highest EPS growth in the market; mature semis and hardware firms sit near the low end. |
| Healthcare | 10% | 4% | 18% | Branded pharma benefits from patent-protected pricing and buybacks; biotech and med-tech swing wider on pipeline events and regulatory outcomes. |
| Communication Services | 14% | 4% | 28% | Digital advertising recovery and streaming profitability inflated EPS growth for large-cap platforms; legacy telecom carriers show low single-digit gains on heavy capex. |
| Consumer Discretionary | 8% | -5% | 18% | E-commerce and travel recovery lifted the top end; auto OEMs and discretionary retailers face margin pressure and demand normalization, pulling the low end negative. |
| Industrials | 8% | 2% | 15% | Aerospace and defense benefit from pricing power and backlog; freight and short-cycle machinery face volume headwinds, compressing earnings at the low end. |
| Financials | 9% | 2% | 18% | Higher-for-longer rates boosted net interest income at banks; fee-based wealth managers and exchanges benefit from market levels and activity; insurance benefits from pricing cycles. |
| Consumer Staples | 5% | 1% | 9% | Pricing-driven margin recovery and steady buybacks support low-to-mid single-digit EPS growth; volume growth is modest as consumers trade down. |
| Materials | 4% | -8% | 14% | Deeply cyclical: specialty chemicals and industrial gases are steadier; metals and mining EPS swings widely with commodity prices — down-cycle years routinely go negative. |
| Real Estate (REITs) | 4% | -2% | 9% | REIT EPS is less meaningful than FFO/AFFO due to depreciation; data-center and industrial REITs lead on rent growth; office and retail REITs face structural demand headwinds. |
| Energy | 6% | -20% | 30% | The widest EPS range of any sector: oil price swings translate directly into earnings — a 20%+ oil rally can double EPS; a price collapse drives deep losses. Base effects amplify every move. |
| Utilities | 4% | 1% | 7% | Regulated rate-base growth with minimal leverage effect; EPS growth closely tracks revenue growth given predictable cost pass-throughs and limited buyback activity. |
| Basic Materials (Metals & Mining) | 3% | -15% | 18% | Commodity-price and cost-cycle driven; trough EPS can go deeply negative in down-cycles while peak years during commodity bull markets produce outsized growth. |
What Is a Good EPS Growth Rate?
EPS growth — the year-over-year change in earnings per diluted share — is a more volatile but ultimately more shareholder-relevant measure than revenue growth. It sits at the bottom of the income statement after all costs, interest, and taxes, and it is the number that most directly drives valuation multiples: when EPS grows faster than expected, PE multiples expand; when it disappoints, they compress. But "good" depends entirely on the sector.
Above 15% — Strong growth. The company is compounding earnings materially faster than nominal GDP, typically by combining revenue growth with margin expansion and often buybacks. This pace is common in Technology and large-cap Communication Services. The key question is whether the growth is powered by genuine business improvement or financial engineering — a company shrinking its share count through buybacks can post 15% EPS growth on 5% net income growth.
5-15% — Moderate growth. The company is growing earnings at a healthy pace for most non-technology sectors. Industrials, Financials, and Healthcare at 8-12% EPS growth are usually delivering a solid combination of volume, pricing, and cost discipline. Pair the rate with margin direction and return-on-equity trends to confirm the earnings quality.
Below 5% — Slow growth. At or below the rate of nominal economic expansion. For Utilities, Consumer Staples, and REITs, low single-digit EPS growth is perfectly normal and expected — these businesses are valued on yield and predictability, not growth. For Technology or Consumer Discretionary companies, below 5% EPS growth warrants scrutiny: is the business maturing, facing margin pressure, or encountering competitive headwinds?
Always compare a company's EPS growth to its sector median above — and strip out one-time items and buyback effects to assess the underlying earnings trajectory. A Utility at 4% is right on target; a software company at 4% deserves a hard look at whether its moat is eroding.
How to Use This Data
1. Benchmark within the sector, never across
EPS growth norms span over 25 percentage points across sectors. Find the company's GICS sector in the table, then judge whether it sits in the low, mid, or high part of that sector's range. Comparing a Technology company's EPS growth to a Utility's produces false signals in both directions. Screen for the fastest and slowest earners with the EPS growth screener.
2. Compare EPS growth to revenue growth
When EPS growth persistently exceeds revenue growth, the company is expanding margins and/or buying back shares. When EPS growth consistently lags revenue growth, margins are compressing or shares are being diluted. The spread between the two rates is one of the most diagnostic signals of earnings quality available without reading a full 10-K. Check revenue growth by industry to complete the picture.
3. Pair EPS growth with the PE multiple
EPS growth drives PE re-rating: a company growing EPS at 20% trading at a 15x PE is likely undervalued relative to growth; one growing EPS at 5% at a 30x PE needs to accelerate or de-rate. The PE ratio calculator and PE by industry benchmarks give you the multiple context to complete the valuation picture.
Common questions
EPS growth rate by industry — answered directly.
What is good EPS growth by industry?
Good EPS growth is entirely sector-relative. Technology and Communication Services companies growing EPS above 15% are performing well for their categories, while a Utility or Consumer Staples business at 4-5% EPS growth is right on target. As a rough cross-sector guide: above 15% is strong, 5-15% is moderate, and below 5% is slow — but only after placing the company against its own sector median in the table above. EPS growth is also more volatile than revenue growth, so a single-year spike or dip matters less than the multi-year trend. Always confirm whether EPS growth is driven by earnings quality (margin expansion, volume growth) or financial engineering (heavy buybacks, one-time gains).
Which industries have the highest EPS growth?
Technology consistently leads EPS growth, with medians near 18% and top-quartile performers clearing 30%+, driven by AI and cloud margin expansion and aggressive buyback programs. Communication Services follows, with large digital advertising platforms posting outsized EPS recoveries when ad markets rebound. Energy and Basic Materials can produce the highest absolute EPS growth in a single year during commodity bull markets — but are also the most likely to go negative in down-cycles, making the median figure less predictive than in other sectors. For investors prioritizing sustainable, high-quality EPS compounding, Technology and Healthcare tend to be more consistent than cyclical commodity sectors.
How is EPS growth different from revenue growth?
Revenue growth measures the top-line change in sales and reflects demand for the company's products. EPS growth measures the bottom-line change in earnings per diluted share and reflects how efficiently that demand converts into profit available to shareholders. EPS growth is far more volatile because it is affected by operating leverage (fixed-cost amplification), financial leverage (interest expense), tax rate changes, one-time items (impairments, restructuring, legal settlements), and share count changes from buybacks or dilutive issuances. A company can grow revenue 8% and grow EPS 20% through margin expansion and buybacks — or grow revenue 8% and shrink EPS on rising costs. For quality assessment, track whether EPS growth exceeds revenue growth (expanding margins, buyback benefit) or consistently lags it (margin compression, dilution).
How do I use EPS growth benchmarks to analyze a stock?
Start by locating the company's GICS sector in the table and identifying whether its EPS growth sits in the low, mid, or high part of the range. A Technology company growing EPS at 10% is below its sector median and deserves investigation: is it losing share, facing margin pressure, or going through a trough investment cycle? A Utility growing EPS at 8% is well above its sector ceiling and worth understanding — is it a rate case win, a one-time item, or genuine operational outperformance? Second, compare EPS growth to revenue growth. If EPS growth persistently exceeds revenue growth, the company is expanding margins and/or buying back shares — both can be value-creating signals. If EPS growth consistently lags revenue growth, margins are compressing. Finally, strip out one-time items and buyback effects to assess the quality of the underlying earnings trajectory before drawing conclusions.
Related Tools & Resources
EPS Growth Screener
Screen for companies above or below EPS growth thresholds across all sectors to find the fastest and slowest earners against their peers.
PE Ratio Calculator
EPS growth drives PE re-rating — use the PE calculator to see how a company's earnings multiple compares to its growth rate and sector peers.
Revenue Growth by Industry
Compare top-line growth benchmarks by sector — pair with EPS growth to diagnose whether earnings gains are coming from revenue momentum or margin expansion.
PE Ratio by Industry
Understand valuation multiples by sector — the PE ratio is a direct function of EPS growth expectations, making these two benchmarks inseparable.
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