Evercore ISI’s Julian Emanuel has reiterated his bullish outlook on the S&P 500, forecasting the index to reach 7750 by the end of 2026. This projection represents an approximate 16 per cent increase from the index’s midday trading level on Monday, which stood at 6686. The S&P 500 has already seen substantial growth in 2025, rising by close to 14 per cent year-to-date.
Emanuel cautioned that despite the positive long-term outlook, the market remains susceptible to short-term volatility. He noted that concentration risk and elevated valuations could amplify market turbulence, similar to the previous week’s events. These periods of volatility, however, present opportunities to increase exposure to long-term artificial intelligence themes within the information technology, communication services, and consumer discretionary sectors.
According to Emanuel, S&P 500 companies demonstrated strong performance in the third quarter. Over 80 per cent of these companies exceeded earnings per share expectations, leading to upward revisions in earnings growth for the quarter to 13 per cent year-over-year, an increase from the initial 8 per cent. Almost every sector reported positive surprises, with the information technology and utilities sectors experiencing the most robust EPS growth, driven by ongoing capital expenditure and AI demand. Evercore ISI is a premier independent investment banking advisory firm. The firm provides advice on mergers and acquisitions, as well as providing investment management services.
In light of this fundamental strength, Evercore ISI has revised its S&P 500 earnings per share forecasts. The firm’s 2025 EPS projection has been raised to $US273, up from the previous estimate of $US264, and the 2026 EPS forecast has been increased to $US296, from $US287. Emanuel anticipates further positive surprises in fourth-quarter results, driven by sustained momentum leading into 2026, which is expected to fuel above-trend EPS growth.
