Ed Yardeni, senior market strategist at Yardeni Research, dismissed concerns
that US stocks are in a bubble, saying the current rebound is driven by
"Fabulous Earnings Momentum" (FEMO) rather than speculation. He said if the US
economy can avoid a recession over the next few years, the S&P 500's current
forward P/E of about 20–22x looks reasonable. Yardeni coined the term FEMO to
distinguish the present advance from "FOMO" (fear of missing out), which he
described as hope- and speculation-driven rather than fundamentals-driven. He
conceded that outsized recent gains in some semiconductor names give the market
a "melt-up" feel. Under a "roaring 2020s" scenario, he expects the S&P 500 could
reach 10,000 before 2030, implying roughly a 33% rise from current levels.
Year-to-date he has observed only one notable sell-off, in March, and he said
another similar sell-off is unlikely before year-end. His FEMO thesis also
underpins his 2026 S&P 500 target of 8,250, which ranks highest among analysts
tracked by Bloomberg.
