US Equity Views

Goldman Sachs

Ben Snider, David Kostin, Daniel Chavez, Jenny Ma, Kartik Jayachandran, Ryan Hammond

Research

19 Pages

With the “Maleficent 7” pushing the S&P 500 index to the brink of correction, Goldman Sachs updates their S&P 500 EPS and valuation forecasts for 2025. 

Key Takeaways

Revised S&P 500 Forecast: Goldman Sachs lowers its 2025 year-end S&P 500 target to 6,200 from 6,500, reflecting a reduced forward P/E multiple of 20.6x (down from 21.5x) and adjusted EPS estimates of $262 for 2025 and $280 for 2026.
Market Volatility Drivers: The recent market correction is attributed to increased policy uncertainty, particularly regarding tariffs, concerns over economic growth, and significant hedge fund positioning unwinds.
Economic Growth Outlook: Goldman Sachs revises its U.S. GDP growth forecast for 2025 to 1.7% (from 2.2%), citing the anticipated rise in the effective tariff rate to 13% and elevated economic policy uncertainty.
Investment Strategies: Investors are advised to consider stocks with low sensitivity to economic growth, trade policy risks, and AI trends.
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