Wall Street suddenly agrees on one thing — the earnings are that good. Profit forecasts for the S&P 500 have surged to 32% this year, a third higher than analysts penciled in before summer. Now, strategists are racing to lift their year-end targets... before the market gets there first.
- HSBC made the boldest call, lifting its target from $7.65K to $8.10K — while Barclays raised its own to $7.95K from $7.80K.
- In Q2, 86% of firms topped estimates, the best rate since 2021 — powered by AI names like Amazon and Alphabet.
Not so fast: Despite the bullish targets, RBC sees real risk of a 5-10% pullback. The bank points to September's historically rough stretch, AI backlash creeping into midterm campaign issues, and a war in Iran still without a peace deal. Nvidia is feeling the strain too, warning that surging memory costs will squeeze margins ahead. Even so, RBC calls the guidance risk "elusive," since most 2027 EPS growth forecasts are still rising. Wall Street is bracing for turbulence, but nobody's betting the earnings story breaks first.