Just recently in our “Daily Market Commentary” (subscribe for free), we discussed Wall Street setting its sights on S&P 5000.
“Wells Fargo’s Chris Harvey raised his year-end S&P 500 price target to 4,825 from 3,850, as reported by Bloomberg’s Lu Wang. This move follows a weekend note by David Lefkowitz, head of equities for the Americas at UBS Wealth Management, who raised his year-end price target for the S&P 500 to 4,600 from 4,500.
Lefkowitz also raised his June 2022 price target to 4,800 from 4,650, with the real headline coming from his year-end 2022 S&P 500 price target — 5,000.
‘Yes, the rally off the COVID-19 bottom in March 2020 has been extraordinary, but we think there are further gains ahead,’ Lefkowitz writes. ‘Solid economic and corporate profit growth, in conjunction with a still-accommodative Fed, means that the environment for stocks remains favorable. As a result of our higher EPS estimates, we raise our targets for the S&P 500 for December 2021 by 100 points to 4,600 and June 2022 by 150 points to 4,800. We initiate our December 2022 target of 5,000, representing about 13% price appreciation from current levels.’” – Yahoo
The Race To 5000
Considering the marketalready doubled from the pandemic lows, the escalation of price targets is not surprising. Such is particularly the case when Wall Street needs to sell products to retail investors.
“The following graph and commentary from GMO, show that over the last year corporations took advantage of higher share prices. Interestingly, IPO issuance is currently running at the same pace as the market peak in 2000. Massive issuance from existing stocks is largely responsible for the big difference between total issuance today versus 2000.” – Michael Lebowitz