The advance that pushed the Standard & Poor’s 500 Index to a record left companies trading closer to analyst price estimates than any time in at least seven years.

Shares in the index are 5 percent away from analysts’ mean forecasts after the benchmark gauge rallied 10 percent in the first quarter, according to data compiled by Bloomberg starting in 2006. That’s the smallest difference ever for the median stock and compares with the historical average of 14 percent.

Bulls say the narrowing spread shows securities firms were caught off guard by the rally and that equities will climb as they boost predictions. Bears say the slowness of analysts to respond means stocks have gotten so far ahead of themselves that even market optimists are uncomfortable with the increase, which has added more than $10 trillion to values since 2009.

“The market has moved so fast, it hasn’t given the analysts time to re-evaluate things,” Malcolm Polley, who manages $1.1 billion as chief investment officer at Stewart Capital Advisors LLC in Indiana, Pennsylvania, said in a March 26 phone interview. “As we just finished earnings season and we’re winding down the first quarter, analysts will begin the process of reassessing. My sense is we’re looking for better economic and corporate things than we’re seeing today.”

The S&P 500 rose 0.8 percent to 1,569.19 last week, passing the previous all-time high of 1,565.15 from October 2007, after better-than-estimated durable goods orders and the biggest increase in home prices in almost seven years. Stocks have gained 10 percent in 2013, compared with increases of 4 percent in the dollar, 0.6 percent in commodities and 0.6 percent gain in global bonds, according to data compiled by Bloomberg. The S&P 500 added 0.1 percent to 1,570.06 at 9:44 a.m. New York time today.

Negative Spread

Stocks from Western Digital Corp. to PG&E Corp. are closing in on average forecasts, derived by taking the mean of all price estimates for individual companies among securities firms tracked by Bloomberg. A total of 401 are trading either within the historic average of 14 percent or above price estimates, projections show. Should every one of them reach the predicted level, the S&P 500 would surpass 1,680, according to market- weighted data.

Archer-Daniels-Midland Co. and Mattel Inc. are among 134 companies that have already surpassed the average projection, the most since at least 2006. The last time there were more than 100 companies trading above targets was in 2009, when the S&P 500 rose 24 percent. On average, companies that climbed above analyst forecasts since 2006 rose another 9.6 percent in the next 12 months, twice as much as the rest of the market, data compiled by Bloomberg show.

Catching Up

“The market has gotten it right and analysts have been a bit tardy,” Johannes Jooste, who helps oversee more than $1.76 trillion in client assets at Merrill Lynch Wealth Management in London, said in an interview on March 27. “Their fear of systemic risk is still excessive.”