Equity analysts at UBS have raised their June 2024 price forecasts for the S&P 500 benchmark index to 4700 citing an expectation that earnings growth will gather pace in 2024:
- expects S&P 500 EPS of $220 (0% YoY, +4% YoY ex-energy) for 2023 and $240 (+9% YoY) for 2024
- “The more resilient economic activity is having a favorable impact on corporate profits. With second quarter earnings season largely complete, the results give us conviction that S&P 500 EPS growth has likely troughed,”
- 2023 year-end target for the S&P 500 is 4,500
- “Stocks should be able to climb a bit higher in 2024 as earnings growth improves and the market begins to anticipate eventual Fed rate cuts if inflation continues to trend to the Fed’s target”
UBS says that if AI really proves to be a game-changer, and economic growth proves to be resilient, and inflation “cools quickly” the index could hit 5200:
- a U.S. recession and high inflation could see it drop to 3,500
