The S&P 500‘s already delivered a near-11% total return since January, powered by strong corporate earnings and continued AI investment.
But with the index now brushing record highs and valuations looking stretched in places, how much higher can it realistically go?
Here’s what the experts think.
The latest forecasts
The general consensus from most institutional analysts is the S&P 500’s actually still on track to climb even higher, albeit modestly.
Right now the index is sitting close to 7,500 points. But according to a Reuters poll across 47 analysts, the median price forecast for the US flagship index is 7,620 – around 2% higher than current levels.
In terms of money, that means a £1,000 investment today could only grow to around £1,020 over the next six months, which is pretty underwhelming.
However, while index investors might not have a thriving time for the rest of 2026, the same isn’t the case for stock pickers. In fact, even in today’s elevated market environment, there are still plenty of US stocks that look primed to thrive. And right now, there’s one S&P 500 stock in particular that many institutional analysts are backing.
Which stock should investors be watching?
Meta Platforms (NASDAQ:META) is currently trading around $600 a share. Yet looking at the latest analyst forecasts, the average consensus suggests that number should be much closer to $825. That’s a roughly 37.5% projected capital gain – enough to turn £1,000 into £1,375 if these projections prove accurate.
So what’s driving this bullish sentiment? In short: AI monetisation.
In Meta’s most recent quarter, new AI-powered ad tools drove a 3% increase in conversion rates and a 12% improvement in ad quality.
For advertisers, that’s a substantial increase in the value proposition of advertising on Meta’s various platforms such as Facebook, WhatsApp, and Instagram. And this steady improvement in advertising effectiveness is a big reason why click-to-message ads in the US grew more than 50% in 2025, while WhatsApp paid messaging crossed a $2bn annual run rate.
With momentum still building, it’s easy to understand the optimism. However, even the bulls have some reservations.
AI might be delivering results, but it’s coming at an enormous cost. Capital expenditure for 2026 is guided at $115bn-$135bn – nearly double last year’s pace. And if AI earnings take longer to materialise than expected, the near-term pressure on margins may not prove to be temporary after all.
So the question now is: is this a risk worth taking?
The bottom line
With indices concentrated and valuations stretched, we’re very much in a stock-picker’s market right now. And while Meta certainly isn’t the only S&P 500 stock for investors to explore, it does present a potentially compelling case for investors seeking exposure to this part of the tech sector.
That’s why I think it deserves a closer look.
Should you invest £5,000 in Meta Platforms right now?
When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.
And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Meta Platforms made the list?
Zaven Boyrazian does not hold any positions in the companies mentioned.
