Goldman Sachs raises Euro Stoxx 50 dividend forecasts

Goldman Sachs has raised its dividend forecasts for the Euro Stoxx 50 index to 194.7 for 2027 and 218.3 for 2028, marking an increase of approximately 6 index points compared to its May projections. The upward revisions reflect strong dividend resilience in Europe and Japan, where payouts have kept pace with underlying equities, in contrast to the United States where tech-heavy S&P 500 dividend growth has lagged index gains. The investment bank highlighted expanding earnings expectations across major markets, bolstered by AI-related capital expenditure and semiconductor strength. Goldman Sachs' equity strategy team upgraded its fiscal year 2026 earnings per share growth forecast for Europe from 10% to 15%, led by energy, basic materials, technology, and financial sectors. Additionally, the Euro Stoxx 50 is set for monthly rebalancing, with Engie and Nokia replacing Volkswagen and Wolters Kluwer, which will introduce a minor drag of about 1 index point per year. Overall dividend risk premia remain historically compressed, supported by strong fundamentals and consistent upward earnings revisions across European markets.