Growing investor appetite is now coming together with an ever-expanding horizon of expert forecasts for the S&P 500 broad barometer of Wall Street. The fresh example is Evercore ISI, a global banking advisory firm connected with over $4.7 trillion of various merger & acquisition, restructuring deals and transactions since it was founded in 1995. As we go into the first month of autumn, Evercore decided to suddenly raise its year-end 2026 target price for the S&P 500 futures to as much as 7,750, which is nearly 20% above the current achievement lying between 6,400 and 6,500. If those experts are so generous to average market estimates, then we may imagine their dizzying hope for the flagships of the AI industry. And it's exactly the AI drivers that Evercore refers to, describing the segment's value future dynamics "in a manner comparable to the internet boom of the late 1990s".
They also noted how rapid and powerful were all the rebounds from that days' temporary drawdowns and that the Federal Reserve launched the cycle of interest rate cuts on the similar stage of the 1990s rally as well. In terms of earnings per share, which is quite a different matter from the market value, Evercore lifted its estimate to $264 a share for 2025 and $287 for 2026, thanks to fading trade policy uncertainty, and "early signs of AI adoption improving corporate productivity", which is the most important thing for those trading or checking the AI cases. For the longer run, Evercore even outlined the most bullish scenario in which the index may reach 9,000 "if investor enthusiasm turns into an AI-driven bubble", and a bear case in which "sticky" inflation and weak economic growth pull the benchmark down to 5,000 at some moment. We could note that even the bearish, or rather crisis, case doesn't look so bad here, as we already observed 5,000 this spring on global trade tariff threats.
At the same time, Evercore analysts are a bit more careful about the prospects in nearest months of 2025, but we should account that they just shifted from a rather sceptic camp before and now Evercore experts climbed up to at least a 6,250 projection from 5,600 previously, citing possible "bouts of volatility". However, it is precisely the volatility surges of individual stocks that are the bread and butter of traders during protracted rallies like the current one. Broadcom's (AVGO) stock price soared an incredible 2.28x from early April's lows under $140 to over $317 at its recent August peaks. Yet, the following slight rebound to some lower range between $282 and $300 per share may give hope for a short-term increase in volatility immediately after Broadcom's quarterly report, which is scheduled for the September 4-5 night. To catch any lower quotes for AVGO if they occur in extended trading hours near midnight or in the next couple of working days, if a mixed interpretation of earnings may initially prevail in such stories, should be a great success for a smart investor. Again, dot-com gains in the 1990s were much more broad-based, and now market gains are more narrowly concentrated, so any release of the AI enablers like Nvidia or Broadcom has a stronger potential of creating convenient shake-ups in the market for good entries into other swinging assets.
