I was shocked today to see that Bank of America has a price target on the SPX nine-years out.
We normally just see year-end price targets for the current year.
Here are the 2016 year-end price targets from top Wall Street analysts from way back at the very start of 2016.
As everyone knows, Wall Street firms reserve the right to adjust year-end price targets at any time. Some firms like to “cover all the bases“.
Check out these year-end price targets for 2015 (last year):
As we know the SPX closed 2015 at 2044, but sometimes things take longer to work out. It’s common practice to push back a year-end target until the end of the following year, just ask Tom Lee.
But I digress. The thing that grabbed my attention today was BofA’s SPX 3500 target for the year 2025, 9-years from now.
I’m certain a team of expert analysts wearing expensive neckties put a lot of work into that prediction, but I wanted to document it so that 9-years from now we can check back to see how it worked out.
Interestingly enough, that projection only assumes a modest average annual return of 5.35% each year for the SPX over the next nine years.
Based on that conservative rate of return it actually seems plausible.
But the one thing that concerns me about predicting the future is that “a lot can happen between now and then”.
Does it make sense to have SPX price targets out that far? I don’t know, but I found it extremely amusing.
Check back here in the year 2025 and we’ll see how they did.