Industry Analysts Project 29% Increase in S&P 500 Price Over the Next 12 Months

After declining over the past month, where do industry analysts believe the price of the S&P 500 will go from here?

Industry analysts in aggregate predict the S&P 500 will see a price increase of 28.9% over the next twelve months. This percentage is based on the difference between the bottom-up target price and the closing price for the index as of yesterday (March 26). The bottom-up target price is calculated by aggregating the median target price estimates (based on company-level estimates submitted by industry analysts) for all the companies in the index. On March 26, the bottom-up target price for the S&P 500 was 8,349.36, which was 28.9% above the closing price of 6,477.16.

At the sector level, the Information Technology (+40.9%) sector is expected to see the largest price increase, as this sector had the largest upside difference between the bottom-up target price and the closing price on March 26. On the other hand, the Energy (-2.4%) sector is expected to see the largest price decrease, as this sector had the largest downside difference between the bottom-up target price and the closing price on March 26.

At the company level, the ten stocks in the S&P 500 (with a minimum of 3 target prices) with the largest upside and downside differences between their median target price and closing price (on March 26) can be found on page 4 of the Earnings Insight report.

It is interesting to note that there has been a divergence in the direction of the bottom-up target price and the closing price for the index since February 25. While the bottom-up target price has increased by 0.9% (to 8,349.36 from 8.272.80) since February 25, the closing price has declined by 6.8% (to 6,477.16 from 6,946.13) over this same period. At the sector level, 8 of 11 sectors have recorded an increase in their bottom-up target price and a decrease in their closing price since February 25. The only sector that has recorded an increase in both its bottom-up target price and its closing price since February 25 is the Energy sector.

 The FactSet Earnings Insight report will be published one day early next week on April 2. 

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