Wall Street Analysts Race to Reprice S&P 500 Targets

Forex - U.S. stocks are on track to achieve one of the best rallies of a generation post-election, pushing all three major benchmarks to all-time highs and leading to a series of Wall Street price target adjustments indicating further double-digit gains over the next year.

The S&P 500, the broadest blue-chip stock index in the U.S., has risen nearly 27% so far this year and has climbed about 20% since the decline in early August, which was tied to increased volatility in the stock and bond markets linked to the Japanese yen.

Since the November elections, the index has increased by 5.15%, surpassing the 6,000-point mark and significantly exceeding Wall Street analysts' forecasts for the beginning and middle of 2024. Charlie Bilello, Chief Market Strategist at Creative Planning, notes that the current S&P 500 level is about 680 points above the highest targets from Wall Street for 2024 and 25% north of the average level of 4,861 points.

Perhaps not wanting to miss another leg of the current bull market that began in early October 2022, forecasters seem to be competing with each other for the best forecast on 2025 earnings, particularly from Christopher Harvey of Wells Fargo (NYSE:WFC). Harvey, referencing Ian Fleming's fictional spy hero James Bond and his "007" moniker, has set a target of 7,007 points for the S&P 500 by the end of next year, one of the highest targets on Wall Street.

Currently, Harvey predicts that the S&P 500's aggregate earnings will rise to $274 per share next year, a figure that was previously estimated at $270 and projected to reach $318.50 in early 2026.