Goldman Sachs analyst Ben Snyder believes that further growth in corporate earnings could lift the index by about 6% more from current levels, Investing.com noted.
The bank also improved its earnings per share forecast for companies in the S&P 500 index. For 2026, the index is expected to be $340, about 24% above current levels. For 2027, the forecast has been raised to $385, an increase of another 13%.
The bank estimates that about half of this year’s earnings growth will come from companies related to artificial intelligence infrastructure – primarily chip makers, data centers and computing power providers.
Instability keeps risks alive
Despite the positive outlook, the bank’s analysts believe the market could face periods of instability.
In particular, a possible rise in oil prices, which could worsen financial conditions and slow economic growth, remains a risk to the market. In addition, the shares of AI-related companies have already risen strongly, so investors expect very strong performance from them.
The bank also noted that further market gains are unlikely due to expanding market valuations of companies. The S&P 500 index now trades at about 21 annualized company earnings, and Goldman expects this figure to remain around current values.
The bank’s analysts added that after the strong rally of recent months, the market may switch to a more moderate growth. The dynamics may also be affected by seasonality associated with the midterm elections in the United States.
