Stocks have entered a new bull market and the S&P 500 could soar 26% in the next 12 months, Leuthold Group's Jim Paulsen says

Prediction  

Paulsen sees stocks entering a new bull market on about 60/40 odds of the US avoiding recession or the economy experiencing a mild recession.

"In the first year of bulls, earnings don't do well at all. They're generally flat, they're often down. But what really happens is multiples go way up," he said.

"Let's say earnings go to $220 or even $215 in the next year - but the multiple goes from the bear-market low of around 17 up to 22 or 23 times, it gets me to around 5,000," on the S&P 500. he said. "And I don't think that that's all that unreasonable."