Goldman Sachs Strategists Project 12% S&P 500 Total Return for 2026

Goldman's 7,600 year-end S&P 500 target, published April 2, decomposes into two variables: $305 to $309 in forecast earnings per share and a 22x forward price-to-earnings multiple that requires the Federal Reserve to stay on its easing path. Both need to hold.

The note was co-authored by David Kostin, the firm's outgoing Chief U.S. Equity Strategist who is retiring after 30 years at Goldman, and Ben Snider, his designated successor. For employees who track prestige signals in research output, Kostin's farewell call is an explicitly bullish one, and the 7,600 target sits meaningfully above where Street consensus was clustered when the note circulated.

The EPS component is the first load-bearing pillar. Goldman forecasts S&P 500 earnings of $305 to $309 for the full year, representing 12% year-over-year growth. That pace would extend the current streak of consecutive quarters of double-digit earnings expansion to six, a run not recorded in over a decade. The strategists described this earnings trajectory as a "fundamental floor" capable of absorbing near-term geopolitical volatility rather than a target that evaporates the moment headline risk re-escalates.

The second pillar is the multiple regime. Reaching 7,600 on that EPS range requires sustaining roughly 22x forward earnings, a historically elevated level that the note treats as defensible rather than speculative. The rate environment is central to that argument: Goldman embedded an additional 50 basis points of Federal Reserve cuts into its base case, pushing the terminal rate toward 3.0% to 3.25%. The firm's 2026 U.S. real GDP growth forecast of 2.6% also sits 60 basis points above the 2.0% consensus, providing the macro scaffolding for both the earnings trajectory and the multiple. On global GDP, Goldman projected 2.8% growth against a 2.5% consensus, a divergence that makes the bullish earnings model harder to dismiss as outlier thinking.

The April 2 update addressed the late-March selloff directly. The memo described the deleveraging event as having "cleared the decks," and the strategists noted that the April 1 rebound was driven partly by short covering rather than a fundamental shift. Their base case is that once headline macro risks show any sign of de-escalating, underlying earnings momentum supports a multi-quarter recovery. Critically, Goldman's bull case does not depend on megacap concentration holding. The note argues AI is transitioning from a capital expenditure phase to measurable productivity gains across non-technology sectors, broadening the earnings base beyond the handful of names that carried index performance through 2024 and 2025.

The signposts that would validate the 7,600 call are specific: Q1 earnings beats showing margin durability, AI productivity registering in enterprise results beyond the hyperscalers, credit spreads holding, and the rally broadening to cyclicals and mid-caps. The thesis breaks if geopolitical escalation knocks the Fed off its easing path, wage inflation compresses margins below the $305 EPS floor, or financial conditions tighten enough to make 22x indefensible. Breadth is the most visible indicator; a narrowing back toward a stressed handful of megacap names would undercut the "broad-based marathon" framing entirely.

For Goldman's own teams, the research note functions as a six-week operational mandate. Research analysts should prepare for elevated inbound volume from asset managers seeking sector rewrites and model revisions as Q1 earnings season opens the week of April 14. Equity derivatives desks will likely see demand spike for bullish structures and increased delta-hedging activity. For ECM bankers whose deal pipelines stalled through March, a constructive equity backdrop underwritten by Goldman's own research creates the credible window to restart marketing. If flow volumes and advisory fees track the outlook, the compensation pools tied to equities and markets revenue move directionally higher. In a year where the first quarter handed most desks a difficult environment to monetize, the April reset matters.