Goldman Sachs sets its 12-month target price for the S&P 500 at 8,700 points, about 13% higher than the current 7,704, clearly bullish. In the chart, the dark line shows the index’s performance, while the light line shows adjusted earnings per share. Goldman’s logic is that earnings will not be disrupted, so it revises EPS upward in a straight line: $275 for 2025, $375 for 2026, $415 for 2027, and $460 for 2028—nearly a 70% increase over three years. The index follows earnings, which is the rationale behind the bullish stance. Higher EPS can also provide valuation support. But that earnings curve is drawn as a smooth straight line, implying that “no disruption” is a very strong assumption. When it comes time to execute—rate hikes, recessions, and unexpected events may all reduce the impact. The target price is an event 12 months away; the road in between may not be smooth. Even if you look at Goldman’s past predictions over the last few years, there have been misses. The target price is an opinion, not a guarantee. You can listen to the bullish logic, but your position size is still your own decision.