How Analyst Dan Nathan Explains Dollar Weakness Driving S&P 500 Disparities

SingleForYears · 2026-02-12T21:00:33+00:00

Dan Nathan highlighted significant earnings disparity among S&P 500 firms, driven by currency market dynamics. A weaker U.S. dollar benefits companies with international operations, enhancing earnings through favorable currency conversions, while those reliant on domestic revenue face challenges.

SingleForYears

2026-02-12 21:00:33

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Financial analyst Dan Nathan recently highlighted a striking divergence in earnings performance among S&P 500 companies, with some reporting roughly twice the earnings growth as their peers. According to analysis shared through FactSet’s Earnings Insight, this disparity largely stems from currency market dynamics. Dan Nathan and fellow analyst Guy Adami emphasized that firms with substantial international operations are gaining a significant advantage as the U.S. dollar weakens.

The mechanism is straightforward: when the dollar depreciates, U.S.-based companies with overseas revenue streams benefit from more favorable currency conversion rates. Foreign earnings translate into higher dollar values when repatriated, effectively boosting reported earnings without requiring fundamental business improvements. This currency tailwind particularly benefits multinational corporations with diverse global operations.

The analysis underscores how currency fluctuations function as a critical but often underappreciated driver of corporate earnings disparities. While many investors focus on operational performance and market conditions, Dan Nathan’s examination reveals that forex dynamics can account for substantial portions of earnings variations across the S&P 500. Companies with minimal international exposure face headwinds by comparison, creating notable performance gaps rooted in macro currency trends rather than competitive positioning alone.

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