The bull market’s been on a three-year tear, and Wall Street’s asking the obvious question: can it keep going? Here’s the thing—most analysts think yes, but they’re not all betting the same amount.
By late December 2025, the S&P 500 had climbed about 18% for the year, hitting all-time highs around 6,932. That’s on top of 24% gains in 2023 and 23% in 2024. The Nasdaq? Up 22.3% to roughly 23,613. Even the Dow got in on the action with a 14.5% gain. Not bad for a market that looked like it might implode in the first four months of the year.
The real question isn’t whether stocks will go up—it’s how much. Oppenheimer’s feeling optimistic, targeting 8,100 for the S&P 500 by year-end 2026, which would mean another 17% pop. Morgan Stanley’s more measured at 7,800 (12.5% gain), while JP Morgan’s sitting in the middle at 7,500 (8% gain). Bank of America? They’re the pessimists, calling for just 7,100—basically flat.
What’s driving the optimism? Corporate earnings have been solid, with four straight quarters of double-digit growth. Add in potential interest rate cuts, tax-friendly policies, and AI-driven efficiency gains, and you’ve got a recipe for continued gains. The catch? Valuations are already stretched. The Shiller P/E ratio is near all-time highs at 40.59, and the Nasdaq 100 trades at 34 times earnings—historically elevated territory.
The real wildcard is whether AI can keep justifying these prices or if we’re looking at a valuation reset. Either way, 2026 should be interesting.
