Goldman Sachs is not giving up hope on their call for S&P 500 1250 by year-end. They remain very bullish on the second half equity markets and believe the recent downturn in equities is reminiscent of past downturns:
“S&P 500 rose 4.2% this week through Thursday. All sectors advanced led by Energy (+5.5%) while Consumer Discretionary trailed (+2.4%). We maintain our 3-month price target of 1160 (+8%) and expect the S&P 500 will rise to 1250 (+17%) at year-end 2010.
S&P 500 Earnings. Our top-down EPS forecasts of $78 and $93 for 2010 and 2011 reflect +38% and +18% growth, respectively. Our pre-provision and write-down EPS forecasts are $83 for 2010 and $93 for 2011. Bottom-up consensus forecasts a 44% increase in 2010 to $82, and an 18% increase in 2011 to $96.”
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.