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The Wall Street analysts who follow individual companies are much more bullish about stocks than the guys who actually try to predict where the market is headed.
Forecasts by individual analysts for S&P 500 member companies, if added together, would have the benchmark index jumping 16 percent this year.
That's more than double the seven percent gain predicted by a consensus of market strategists, who look at the overall market and not individual companies.
While the analysts take a narrow view—one company instead of the overall market—their combined bullishness could end up being more accurate. That's because market strategists look at a lot of intangible things—such as risk from Europe's debt crisis—while analysts focus on hard data such as profit and customer demand.
Either way, a gain of anywhere from seven to 16 percent wouldn't be a bad year for investors, especially after the S&P 500 ended flat for 2011.
According to Goldman Sachs, the consensus target of equity strategists for the S&P is 1350, representing a seven percent gain. Goldman’s own equity strategist, David Kostin, sees a 1.5 percent decline to 1250, citing a “spillover from the European recession” in a note to clients.
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