This stock market signal points to the S&P 500 surging 25% within the next year

• There’s still significant upside potential in the stock market, according to Bank of America.
• The bank said the S&P 500 could surge 25% within the next year based on a bullish indicator.
• “Analyst consensus long-term growth expectations today suggest big gains,” BofA’s Savita Subramanian said.

The S&P 500 could surge more than 25% over the next 12 months based on a bullish stock market indicator that measures sentiment among Wall Street analysts, according to a Friday note from Bank of America’s Savita Subramanian.

Subramanian observed that long-term profit growth expectations among Wall Street analysts are near record low levels, which signals pervasive pessimism. Typically, when there’s such a high level of pessimism towards future corporate profits, the stock market delivers spectacular returns.