60% of Wall Street’s Ratings on S&P 500 Stocks Are Now Buys, the Most on Record

FactSet (NYSE:FDS | FDS Price Prediction) recorded 13,097 analyst ratings on S&P 500 companies heading into the fourth quarter: 59.9% were Buys, 35.5% were Holds, and only 4.7% were Sells.

FactSet senior earnings analyst John Butters weighed in. He wrote that the reading “will mark the highest (month-end) percentage of Buy ratings for the S&P 500 going back to at least 2010.”

Each rating reflects one analyst’s opinion. A Sell call can cost a bank access to the company it covers, so ratings tell you about sentiment as much as research.

SPDR S&P 500 ETF (NYSEARCA:SPY) rose 0.68% in the October 5 regular session and stood at $774.88 that evening. That leaves it up 13.62% for the year, according to FactSet. Earnings will likely decide whether this much optimism holds, because a ratings book with almost no Sells has little room to improve.

What a Record Buy Share Actually Counts

Heavily covered megacaps carry dozens of ratings, so totals skew toward the biggest companies, while analysts often use Hold as a polite way to say Sell, which keeps the Sell category small. FactSet’s five-year average Buy share is 55.9%, so the current reading is above that.

FactSet shows Buy shares of 70% in Communication Services and 70% in Information Technology. Consumer Staples, the least preferred sector, is at 45%, according to FactSet. Those two growth sectors also hold SPY’s largest positions, based on the fund’s March 17, 2026 fact sheet.

It expects third-quarter S&P 500 earnings to grow 29.5%, a third straight quarter above 25%, with all 11 sectors expected to grow.

It also recorded 72 of 116 guiding companies, or 62%, guiding above expectations, versus a five-year average of 40%.

The forward price-to-earnings multiple is 19x, below its five-year average of 20x.

Why the Optimism Could Be the Risk

When everyone expects a strong quarter, results that only meet estimates tend to get sold. The 10-year Treasury yield reached 5.28% on October 2, its highest level since 2002. A higher yield raises the discount rate for future earnings, making the same profits worth less today and giving savers a competing return without stock market risk.

The U.S. Bureau of Labor Statistics reported only 29,000 nonfarm payroll jobs added in September.

FactSet’s 12-month index target is 9,281, meaning 21% upside from the 7,773.99 close on October 5. These combined targets come from analysts setting single-company targets without considering the whole market.

How much ratings vary from sector to sector tells you more than the overall Buy share, since a sector where Sell ratings are rising signals more than one where nearly every rating is a Buy.

On September 28, 2026, Mike Wilson of Morgan Stanley (NYSE:MS) said the share of S&P 500 stocks trading above their 200-day moving average fell from about 75% to below 50%.

What the Record Buy Share Means for SPY Holders

The earnings cycle offers stronger support for SPY than the ratings book does. Earnings growth in every sector and guidance well above its usual level are real evidence. A record Buy rating only tells you what the crowd thinks, and a crowd at a record has little room to get more bullish (we wrote a free handbook on riding a mania without giving back the gains, here).

Analyst optimism is concentrated in technology and communication services, so the cap-weighted index gives the most weight to the most popular ratings. Invesco S&P 500 Equal Weight ETF (NYSEARCA:RSP) holds the same companies at equal weights, which reduces exposure to that concentration.

The case for the index would weaken if the 10-year yield closes above its September 30 high of 5.29% and FactSet’s next update shows the Sell share rising above 4.7%.

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