Barclays raises S&P 500 year-end target, citing 'standout' earnings driven by AI
Barclays raised its year-end S&P 500 target, citing 'standout' earnings season led by tech and durable AI-driven growth.
TL;DR
- Barclays raised its S&P 500 year-end target to 7,950 from 7,800.
- The upgrade is attributed to a 'standout earnings season led by tech'.
- FY26/FY27 EPS estimates were increased to $365/$414, and the YE26/YE27 S&P 500 price target to 7950/8800.
- Big Tech earnings grew 35% year-over-year in Q2, with other tech sectors showing 88% growth.
- AI-driven earnings durability is a key factor supporting the outlook.
- Healthcare and energy also showed strength, while Real Estate and Utilities lagged.
- Hyperscaler capital spending is projected to exceed $1.1 trillion in 2027, a 67% increase.
- Google, Amazon, and Meta are expected to be the largest contributors to hyperscaler capex.