Goldman Sachs: Tech stock valuations under pressure, the biggest opportunity in the stock market by 2026 is not AI

PANews December 15 News, Goldman Sachs’ latest report indicates that investors are currently focused on artificial intelligence and mega-cap technology giants, but the economic acceleration in 2026 could bring greater opportunities to cyclical sectors such as industrials, materials, and consumer discretionary. Analysts expect that the earnings per share (EPS) growth for these sectors will significantly increase, with the industrial sector’s EPS growth potentially jumping from 4% to 15%, real estate companies’ EPS growth rising from 5% to 15%, and consumer discretionary companies’ EPS growth expected to increase from 3% to 7%.
In contrast, the EPS growth for information technology companies may slow from 26% in 2025 to 24% in 2026. Goldman Sachs believes that although cyclical stocks have performed well recently, outperforming defensive stocks for 14 consecutive trading days, the market has not yet fully reflected the potential of the 2026 economic acceleration.
Goldman Sachs forecasts that the overall U.S. economy will accelerate in 2026, driving the S&P 500 index EPS growth by 12%. Analysts emphasize that despite the ongoing AI boom, the market may have already priced in most of the potential gains brought by AI.