S&P 8,000? Wall Street Banks Bet Big on Double-Digit Gains in 2026

S&P 8,000? Wall Street Banks Bet Big on Double-Digit…

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Hello Peter Anthony Hovis,

S&P 8,000? Wall Street Banks Bet Big on Double-Digit Gains in 2026

After last week’s relatively quiet week of trading, Wall Street will have another shortened week, with markets being closed on Thursday in observance of New Year’s Day.

We will receive employment reports from ADP and minutes from the Federal Reserve’s FOMC meeting on Wednesday. Other than that, few catalysts could bring major volume to this week’s trading.

Regardless, the positive outlook for 2026 could push stocks even higher over the next weeks, said Adam Turnquist, chief technical strategist for LPL Financial.

“Momentum heading into year-end suggests a favorable setup for a positive Santa Claus Rally — a historically bullish signal for January and the year ahead,” said Turnquist.

Adam Turnquist, chief technical strategist for LPL Financial (Photo: Fox Business)

Indeed, JPMorgan Chase and HSBC believe the S&P 500 will hit 7,500 by year-end in 2026 — an about 8% gain from the current level. Morgan Stanley and Deutsche Bank see another double-digit year with 2026 targets of 7,800 and 8,000, respectively. The most bullish target would be a more than 15% gain.

This shows how bullish Wall Street is right now.

They just don’t see many negative catalysts that could drag stocks down next year.

“Despite AI bubble and valuation concerns, we see current elevated multiples correctly anticipating above-trend earnings growth, an AI capex boom, rising shareholder payouts, and easier fiscal policy,” said JPMorgan lead equity strategist Dubravko Lakos-Bujas.

JPMorgan lead equity strategist Dubravko Lakos-Bujas (Photo: CNBC)

It is also a worst-kept secret on Wall Street that the economy is K-shaped, where higher-income households have been driving the bulk of spending and wealth growth, while lower-income households have struggled.

Not only that, Big Tech companies have spent a boatload of money on AI infrastructure with questionable profitability, while their stocks are trading at lofty valuations, and more tech companies are taking on debt to fund these projects.

Plus, the Federal Reserve is expected to pause its rate-cutting cycle at its January meeting.

There are risks to both sides, and traders will likely tread carefully over the next few weeks.

Insulet: Tapping into a 14M Patient Market

Today’s Stock Pick: Insulet Corporation (PODD)

Insulet Corporation is a medical device company, and it is best known for its Omnipod insulin delivery system for patients with diabetes.

Unlike traditional insulin pumps that require tubing, the Omnipod is a small, wearable pod that delivers insulin continuously and can be controlled wirelessly.

And, of course, it can be tracked on mobile phones.

(Source: Insulet)

It was the first AID (Automated Insulin Delivery) system to be cleared by the FDA for both type 1 and type 2 diabetes in the USA.

At its core, an AID system is made up of three key parts: a continuous glucose monitor (CGM), an insulin pump (or pod), and a smart algorithm that ties them together.

The CGM continuously reads your glucose levels and sends that data to the controller (either the pump or an associated app). Every few minutes, typically around every five minutes, the algorithm calculates whether to increase, decrease, or pause insulin delivery so your levels stay in range. It’s essentially mimicking how a healthy pancreas would respond to your body’s changing needs.

The AID system is highly popular, and Insulet was the #1 most requested and prescribed AID system.

(Source: Insulet)

Insulet has raced ahead to maintain its leadership in the AID system. It is available in more than 47,000 U.S. pharmacies and is the only AID system that is covered by Medicare Part D.

(Source: Insulet)

The market is large and under-penetrated. The company estimates that there is about 14 million total addressable market of patients, and Insulet is only starting to penetrate the market.

(Source: Insulet)

The financials are world-class. Its revenue grew ~24% CAGR from 2020 to 2025. Gross margin expanded by 660 basis points to 71%. Adjusted operating margin skyrocketed from 7.3% in 2020 to about 17% this year.

So, this company has a strong product and a strong business model, making it a powerful combination.

(Source: Insulet)

Insulet expects another good year with 28% to 29% revenue growth for this year. Clearly, the momentum isn’t slowing down. (Remember that its CAGR was 24% in the last four years.)

(Source: Insulet)

Bottom line: Insulet has developed a revolutionary product, and it has fantastic margins. With the market largely under-penetrated, the stock has a bright future.

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