Evercore ISI has reiterated its 2026 S&P 500 (SPX) price target of 7,750 and believes that the benchmark index could surge to 9,000 in a “bubble scenario.”
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“SPX YE 2026 PT of 7,750, and increased probability of a Bubble scenario to 9,000 to 30%, [is] reinforced by landmark EA LBO,” wrote Evercore in a reference to the recent leveraged buyout of Electronic Arts (EA). Evercore ISI analyst Julian Emanuel believes that the buyout echoes similar transactions in 1988 and 2007, which “marked the acceleration of the Capital Markets Cycle.”
Keep Your Eyes Peeled for a Pullback
At the same time, Emanuel noted that these transactions also led to “significant near term volatility,” adding that the S&P 500 trades well above its 50-day and 100-day moving averages and warning of a market pullback.
To address this risk, Emanuel suggests a portfolio hedge using Nasdaq put options. He remains bullish on the AI sector and also said that “underowned” healthcare stocks could present a tactical opportunity.
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