Investment Rating - The report upgrades the S&P 500 valuation and return forecasts, expecting a rise of 10% to 6900 over the next 12 months, with a forward P/E multiple of 22x [3][4]. Core Insights - The S&P 500 forward P/E of 22x ranks in the 97th percentile since 1980, but is deemed appropriate given the current macroeconomic conditions, including declining interest rates and elevated corporate profitability [3][11][12]. - Earnings growth is projected at 7% for both 2025 and 2026, with EPS estimates of $262 and $280 respectively, although there are two-way risks around these forecasts [6][24]. - The report highlights narrow market breadth, with the median S&P 500 constituent 11% below its high, indicating potential for a momentum reversal in the equity market [30][34]. - Sector allocation recommendations include a mix of secular growth (Software & Services, Media & Entertainment), cyclical (Materials), and defensive (Utilities, Real Estate) industries, with a focus on AI-related technology stocks [41][44]. Summary by Sections Valuation and Earnings Forecasts - The S&P 500 is expected to reach 6900 in 12 months, with return forecasts of +2%, +5%, and +10% over 3, 6, and 12 months respectively [4][47]. - The forward P/E multiple has been increased to 22x, with EPS growth of 7% anticipated for 2025 and 2026 [6][49]. Market Conditions - Current macroeconomic conditions support the elevated P/E multiple, with expectations of earlier Fed easing and lower bond yields [12][16]. - The report notes that investor positioning is neutral, suggesting that current market multiples do not reflect investor exuberance [17][20]. Sector Preferences - There is no clear consensus on sector preferences among clients, but AI-related technology stocks are generally favored despite valuation concerns [41][44]. - The recommendation to invest in Alternative Asset Managers within the Financials sector has been positively received [41]. Market Breadth and Momentum - The S&P 500's recent record high contrasts with the median constituent being significantly below its peak, indicating narrow market breadth [30][34]. - A potential momentum rotation is anticipated, although it is expected to be short-lived rather than indicative of a new long-term trend [40].

Ethan Allen Interiors Inc ETD reported a 2.5% decline in its fiscal third-quarter sales due to double-digit declines in order intake in January and February.The Ethan Allen Analyst: Telsey Advisory Group’s Cristina Fernández maintained a Market Perform rating, while reducing the price target from $32 to $30.The Ethan Allen Interiors Thesis: The 11% decline in the company's order intake in the latest quarter followed a 14% increase in the fiscal second quarter, Fernández said in the note.Check out other anal ...

Group 1 - eBay Inc is experiencing unusual options activity with 18,000 calls and 15,000 puts traded, which is five times the average intraday volume [1] - The surge in options activity follows the announcement of CFO Steve Priest's resignation in May, with Peggy Alford from PayPal set to replace him, alongside better-than-expected revenue for Q1 and an optimistic Q2 forecast [2] - eBay's stock has a 10-day put/call volume ratio of 7.86, indicating a significant increase in put buying, ranking higher than 99% of readings from the past year [3] Group 2 - Despite positive news and bullish options flow, eBay's stock is trading lower, down 1% at $67.51 after briefly exceeding $70, pulling back from a year-to-date gain of over 10% [4] - The 126-day moving average near $65 is identified as a key support level, having contained multiple pullbacks throughout April [4]

Shares of PepsiCo Inc. PEP tanked after the company reported a sales decline for the first quarter on Thursday.BofA Securities On PepsiCoAnalyst Bryan Spillane maintained a Neutral rating while reducing the price target from $155 to $150.PepsiCo reported its quarterly results broadly in line with consensus estimates, Spillane said in a note. Management’s 2025 earnings guidance reflects tariff costs of around 40 cents per share, he added.There is a lack of clarity around a recovery in US salty snacks, given ...