There's A Brand New Most Bullish Strategist On Wall Street

As the stock market closes in on its all time high, some of Wall Street's strategist have been waving their caution flags.

But a few of the bravest have reiterated their "Buy" calls, and some have even raised their year-end targets.

Jefferies Sean Darby falls into that latter category.

This morning, Darby cranked up his year-end S&P 500 target to 1,673, making him the most bullish strategist on Wall Street.

Here's a summary of his rationale:

We are lifting our year-end index target for the S&P 500 to 1,673 from 1,565 last calculated on December 17, 2012 (see exhibit 21). Better-than-expected 4Q earnings and forward guidance, a broadening in the earnings base, ongoing share buybacks and continuous rotation out of fixed income ought to keep US equities well bid. We expect the 2013 earnings integer to be closer to 122 versus 111 forecast.

We remain Bullish on US equities within our global asset allocation - a view unchanged since end-2011. While US housing has bottomed out, in our view, the leading drivers for the US equity market have been a restoration of competitiveness and more recently signs that capex spending has started to recover. We have held a non-consensus view over the improvement in the cyclical outlook for US stocks. The Federal Reserve’s aggressive monetary policy has been accompanied by huge political headwinds which we have felt has kept investors trapped in fixed income. The main risk to our view is an unwinding of corporate credit spreads and a change in the pace of monetary expansion. While we acknowledge that the economy is ‘work in progress’ and equity valuations are trading slightly above fair value, the improvement in the earnings picture coupled with subdued bond yields ought to allow equity prices more room to inflate.

Currently, the range of year-end targets are as low as 1,390 (Wells Fargo) to 1,615 (Citi).