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Analyst Ratings and Price Targets (11/18/2019)
 

 
BrokerageActionCompany NameCurrent
Price
Price
Target
RatingImpact on
Share Price
Actions
Societe Generale UpgradesADIDAS AG/S (ADDYY)$147.96Hold ➝ BuyLow    
Berenberg Bank ReiteratesAIB Group (AIBRF)$3.15BuyLow    
Atlantic Securities InitiatesAIR LIQUIDE/ADR (AIQUY)$26.76NeutralLow    
Stifel Nicolaus Raises TargetAlign Technology (ALGN)$263.92$290.00 ➝ $305.00Low    
Peel Hunt ReiteratesAlumasc Group (ALU)GBX 83.50AddN/A    
Cowen Raises TargetAdvanced Micro Devices (AMD)$38.56$40.00 ➝ $47.00OutperformLow    
DNB Markets DowngradesA P MOLLER-MAER/ADR (AMKBY)$6.97Hold ➝ SellLow    
Citigroup DowngradesAmarin (AMRN)$24.02Buy ➝ NeutralLow    
Oppenheimer DowngradesANCHIANO THERAP/S (ANCN)$1.92Outperform ➝ Market PerformLow    
LADENBURG THALM/SH SH DowngradesANCHIANO THERAP/S (ANCN)$1.92Buy ➝ NeutralLow    
Warburg Research Set Price Targetalstria office REIT (AOX)€16.59 €18.70BuyN/A    
Atlantic Securities InitiatesAir Products & Chemicals (APD)$240.92NeutralLow    
SunTrust Banks Raises Targetargenx (ARGX)$139.37 $160.00BuyLow    
Barclays ReiteratesAstraZeneca (AZN)GBX 7,346OverweightN/A    
Peel Hunt ReiteratesBarratt Developments (BDEV)GBX 657.60HoldN/A    
Peel Hunt ReiteratesBerkeley Group (BKG)GBX 4,599AddN/A    
William Blair ReiteratesBristol-Myers Squibb (BMY)$58.59OutperformHigh    
Peel Hunt ReiteratesHenry Boot (BOOT)GBX 259.30BuyN/A    
Jefferies Financial Group Raises TargetBurberry Group (BRBY)GBX 2,094GBX 1,800 ➝ GBX 1,900UnderperformN/A    
UBS Group ReiteratesBurberry Group (BRBY)GBX 2,094GBX 2,220 ➝ GBX 2,175NeutralN/A    
Peel Hunt ReiteratesBreedon Group (BREE)GBX 60.08BuyN/A    
Cowen DowngradesCraft Brew Alliance (BREW)$16.34Outperform ➝ Market PerformLow    
Barclays DowngradesBT Group (BT)$7.62Equal Weight ➝ UnderweightLow    
UBS Group ReiteratesBT Group - CLASS A (BT.A)GBX 192.16NeutralN/A    
Barclays DowngradesBT Group - CLASS A (BT.A)GBX 192.16GBX 240 ➝ GBX 160UnderweightN/A    
Deutsche Bank ReiteratesBT Group - CLASS A (BT.A)GBX 192.16SellN/A    
Morgan Stanley DowngradesCango (CANG)$6.82Overweight ➝ EqualLow    
Liberum Capital ReiteratesCapital & Counties Properties PLC (CAPC)GBX 262.20HoldN/A    
Jefferies Financial Group InitiatesCOCA COLA AMATI/ADR (CCLAY)$7.39BuyLow    
Credit Suisse Group UpgradesCOCA COLA AMATI/ADR (CCLAY)$7.39Underperform ➝ NeutralLow    
Sandler O'Neill UpgradesCommunity Healthcare Trust (CHCT)$45.13Hold ➝ BuyLow    
Goldman Sachs Group Lowers TargetCineworld Group (CINE)GBX 193.20GBX 315 ➝ GBX 295BuyN/A    
Goldman Sachs Group Raises TargetCMC Markets (CMCX)GBX 127.63GBX 100 ➝ GBX 120NeutralN/A    
Peel Hunt ReiteratesCoats Group (COA)GBX 75.15BuyN/A    
Shore Capital ReiteratesCarpetright (CPR)GBX 4.85HoldN/A    
Liberum Capital DowngradesCroda International (CRDA)GBX 4,688GBX 4,500 ➝ GBX 4,400HoldN/A    
Peel Hunt ReiteratesCrest Nicholson (CRST)GBX 368.60HoldN/A    
Berenberg Bank Lowers TargetCrest Nicholson (CRST)GBX 368.60GBX 340 ➝ GBX 300HoldN/A    
Benchmark InitiatesChampions Oncology (CSBR)$5.39BuyLow    
Peel Hunt ReiteratesCountryside Properties (CSP)GBX 368BuyN/A    
Shore Capital DowngradesConsort Medical (CSRT)GBX 1,040HoldN/A    
Peel Hunt ReiteratesCountrywide (CWD)GBX 4.81SellN/A    
Peel Hunt ReiteratesCranswick (CWK)GBX 3,216HoldN/A    
Barclays UpgradesCastellum (CWQXF)$21.30Equal Weight ➝ OverweightLow    
Kepler Capital Markets Set Price TargetDaimler (DAI)€50.14 €56.00BuyN/A    
Goldman Sachs Group Set Price TargetDaimler (DAI)€50.14 €36.00SellN/A    
Kepler Capital Markets Set Price TargetDIC Asset (DIC)€13.66 €15.25BuyN/A    
Peel Hunt ReiteratesDiploma (DPLM)GBX 1,775HoldN/A    
Jefferies Financial Group Set Price Target1&1 Drillisch (DRI)€24.56 €24.00NeutralN/A    
Warburg Research Set Price Target1&1 Drillisch (DRI)€24.56 €48.60BuyN/A    
HSBC Set Price TargetDeutsche Telekom (DTE)€15.16 €17.00BuyN/A    
Piper Jaffray Companies ReiteratesDexCom (DXCM)$208.37OverweightLow    
Peel Hunt ReiteratesEurocell (ECEL)GBX 209BuyN/A    
HSBC UpgradesEFG EUROBANK ER/ADR (EGFEY)$0.50Hold ➝ BuyLow    
BMO Capital Markets UpgradesEquity Lifestyle Properties (ELS)$69.62Market Perform ➝ OutperformLow    
JPMorgan Chase & Co. Set Price TargetEuronext (ENX)€72.50 €81.00BuyN/A    
Goldman Sachs Group UpgradesElement Solutions (ESI)$12.15Neutral ➝ BuyLow    
Sandler O'Neill UpgradesEssex Property Trust (ESS)$319.00Hold ➝ BuyLow    
Canaccord Genuity UpgradesElastic (ESTC)$74.25Hold ➝ BuyHigh    
Peel Hunt ReiteratesVolution Group (FAN)GBX 198.50BuyN/A    
Peel Hunt ReiteratesFerguson (FERG)GBX 6,892AddN/A    
Mizuho ReiteratesFibroGen (FGEN)$36.99 $72.00BuyLow    
Pivotal Research ReiteratesFoot Locker (FL)$45.70BuyLow    
HSBC Set Price TargetFresenius Medical Care AG & Co. KGaA (FME)€66.52 €78.00BuyN/A    
Peel Hunt ReiteratesForterra (FORT)GBX 275AddN/A    
Peel Hunt ReiteratesFoxtons Group (FOXT)GBX 65.90SellN/A    
Deutsche Bank Raises TargetFuture (FUTR)GBX 1,528GBX 1,562 ➝ GBX 1,659BuyN/A    
Peel Hunt ReiteratesGenedrive (GDR)GBX 21BuyN/A    
Peel Hunt ReiteratesGulf Keystone Petroleum (GKP)GBX 222BuyN/A    
Peel Hunt ReiteratesMJ Gleeson (GLE)GBX 818HoldN/A    
Deutsche Bank ReiteratesGlencore (GLEN)GBX 241.01BuyN/A    
Goldman Sachs Group UpgradesW. R. Grace & Co (GRA)$67.63Neutral ➝ BuyLow    
Peel Hunt ReiteratesGreggs (GRG)GBX 2,052ReduceN/A    
Barclays ReiteratesGlaxoSmithKline (GSK)GBX 1,708.13Equal weightN/A    
Kepler Capital Markets Set Price TargetGrand City Properties (GYC)€21.32 €25.00BuyN/A    
Jefferies Financial Group Set Price TargetGrand City Properties (GYC)€21.32 €20.00NeutralN/A    
Goldman Sachs Group Set Price TargetGrand City Properties (GYC)€21.32 €23.00BuyN/A    
HSBC Set Price TargetHenkel AG & Co KGaA (HEN3)€95.48 €109.00BuyN/A    
Peel Hunt ReiteratesHalfords Group (HFD)GBX 165.80SellN/A    
Barclays ReiteratesHikma Pharmaceuticals (HIK)GBX 1,902.50Equal weightN/A    
HSBC Set Price TargetHapag-Lloyd (HLAG)€78.00 €27.50SellN/A    
Nord/LB Set Price TargetHELLA GMBH & CO KGAA (HLE)€47.72 €47.00NeutralN/A    
Jefferies Financial Group UpgradesHSBC (HSBA)GBX 575.80GBX 691 ➝ GBX 790BuyN/A    
Jefferies Financial Group UpgradesHSBC (HSBC)$37.01Hold ➝ BuyLow    
Peel Hunt ReiteratesHomeserve (HSV)GBX 1,179AddN/A    
Goldman Sachs Group UpgradesHuntsman (HUN)$23.21Buy ➝ Conviction-BuyHigh    
UBS Group ReiteratesHowden Joinery Group (HWDN)GBX 614.40GBX 570 ➝ GBX 640BuyN/A    
Peel Hunt ReiteratesHowden Joinery Group (HWDN)GBX 614.40HoldN/A    
Peel Hunt ReiteratesIbstock (IBST)GBX 258.80AddN/A    
HSBC Set Price TargetIndus (INH)€37.65 €50.00BuyN/A    
UBS Group DowngradesAPT Satellite (ISSDY)$11.10Buy ➝ NeutralLow    
HC Wainwright ReiteratesJaguar Health (JAGX)$0.66$10.00 ➝ $3.00BuyLow    
Piper Jaffray Companies InitiatesJ2 Global (JCOM)$95.88OverweightLow    
Mizuho Raises TargetJD.Com (JD)$33.55$31.00 ➝ $33.00NeutralLow    
Peel Hunt ReiteratesJoules (JOUL)GBX 236BuyN/A    
Bank of America UpgradesKB Financial Group (KB)$37.66Neutral ➝ BuyLow    
Bank of America InitiatesKeysight Technologies (KEYS)$109.08NeutralHigh    
Peel Hunt ReiteratesKeller Group (KLR)GBX 539.45AddN/A    
Sandler O'Neill UpgradesKite Realty Group Trust (KRG)$18.88Hold ➝ BuyLow    
Needham & Company LLC ReiteratesKVH Industries (KVHI)$10.89 $13.00BuyLow    
Wedbush Raises TargetL Brands (LB)$18.07$16.00 ➝ $20.00Low    
Barclays DowngradesLiberty Global (LBTYA)$22.64Equal Weight ➝ UnderweightLow    
Atlantic Securities InitiatesLinde (LIN)$209.71OverweightLow    
Barrington Research ReiteratesLincoln Educational Services (LINC)$1.68$4.25 ➝ $3.50OutperformLow    
Peel Hunt ReiteratesLSL Property Services (LSL)GBX 240HoldN/A    
Credit Suisse Group InitiatesLiberty Sirius XM Group Series A (LSXMA)$47.01OutperformLow    
Goldman Sachs Group UpgradesLyondellBasell Industries (LYB)$96.00Buy ➝ Conviction-BuyHigh    
Peel Hunt ReiteratesMcKay Securities (MCKS)GBX 240AddN/A    
Peel Hunt ReiteratesMcCarthy & Stone (MCS)GBX 137BuyN/A    
Cowen ReiteratesThe Medicines (MDCO)$51.98 $60.00BuyHigh    
KeyCorp InitiatesMagnolia Oil & Gas (MGY)$11.71OverweightLow    
Deutsche Bank Set Price TargetMerck KGaA (MRK)€108.20 €104.00NeutralN/A    
Barclays Set Price TargetMerck KGaA (MRK)€108.20 €85.00SellN/A    
LADENBURG THALM/SH SH ReiteratesMarinus Pharmaceuticals (MRNS)$1.09 $5.00BuyMedium    
Peel Hunt ReiteratesMarshalls (MSLH)GBX 731AddN/A    
Northland Securities ReiteratesMACOM Technology Solutions (MTSI)$25.91 $30.00BuyHigh    
Keefe, Bruyette & Woods DowngradesMitsubishi UFJ Financial Group (MUFG)$5.39Outperform ➝ Market PerformLow    
HSBC UpgradesPiraeus Bank (NBGIF)$3.32Hold ➝ BuyLow    
HC Wainwright ReiteratesENDRA Life Sciences (NDRA)$1.02BuyLow    
Needham & Company LLC ReiteratesNew Relic (NEWR)$67.30 $111.00BuyLow    
HC Wainwright ReiteratesInspireMD (NSPR)$0.88 $5.00BuyN/A    
Barclays UpgradesNovo Nordisk A/S (NVO)$57.28Equal Weight ➝ OverweightHigh    
Wells Fargo & Co UpgradesOwens Corning (OC)$65.16Market Perform ➝ OutperformLow    
Canaccord Genuity DowngradesOkta (OKTA)$117.52 $120.00Buy ➝ HoldMedium    
Goldman Sachs Group DowngradesProgressive (PGR)$72.90Conviction-Buy ➝ NeutralLow    
Barclays InitiatesParker-Hannifin (PH)$196.65OverweightLow    
Peel Hunt ReiteratesPolypipe Group (PLP)GBX 472.60AddN/A    
Piper Jaffray Companies ReiteratesInsulet (PODD)$180.34OverweightHigh    
Goldman Sachs Group DowngradesPPG Industries (PPG)$129.50Conviction-Buy ➝ BuyHigh    
Goldman Sachs Group DowngradesPQ Group (PQG)$16.16Neutral ➝ SellLow    
Peel Hunt ReiteratesPureTech Health (PRTC)GBX 220BuyN/A    
Peel Hunt ReiteratesPersimmon (PSN)GBX 2,502HoldN/A    
Deutsche Bank DowngradesPEUGEOT SA/ADR (PUGOY)$26.16Buy ➝ HoldLow    
Commerzbank UpgradesQiagen (QGEN)$40.56Hold ➝ BuyLow    
UBS Group ReiteratesQinetiQ Group (QQ)GBX 337.80GBX 240 ➝ GBX 260SellN/A    
Peel Hunt ReiteratesRedrow (RDW)GBX 647BuyN/A    
Liberum Capital ReiteratesRamsdens (RFX)GBX 202.50BuyN/A    
Liberum Capital ReiteratesReal Estate Investors (RLE)GBX 53.05BuyN/A    
Barclays UpgradesRockwell Automation (ROK)$200.27Equal Weight ➝ OverweightLow    
HSBC Set Price TargetSAP (SAP)€121.28 €145.00BuyN/A    
FinnCap ReiteratesSavannah Resources (SAV)GBX 2.30CorporateN/A    
Hauck & Aufhaeuser Set Price TargetStroeer SE & Co KGaA (SAX)€72.10 €80.00BuyN/A    
Peel Hunt ReiteratesSuperdry (SDRY)GBX 457HoldN/A    
HC Wainwright Raises TargetSeelos Therapeutics (SEEL)$0.86$2.00 ➝ $4.00BuyHigh    
Shore Capital DowngradesThe Sage Group (SGE)GBX 739.40HoldN/A    
Peel Hunt ReiteratesSIG (SHI)GBX 114.40BuyN/A    
HSBC Set Price TargetSiemens Healthineers (SHL)€43.63 €42.00NeutralN/A    
Goldman Sachs Group DowngradesSherwin-Williams (SHW)$592.77Conviction-Buy ➝ NeutralHigh    
Compass Point InitiatesSilvergate Capital (SI)$15.10BuyHigh    
Morgan Stanley UpgradesSplunk (SPLK)$119.20Equal Weight ➝ OverweightLow    
Peel Hunt ReiteratesSpringfield Properties (SPR)GBX 119AddN/A    
Peel Hunt ReiteratesSirius Real Estate (SRE)GBX 74.10BuyN/A    
Citigroup Lowers TargetSarepta Therapeutics (SRPT)$97.46$180.00 ➝ $167.00Buy ➝ PositiveLow    
Buckingham Research ReiteratesState Street (STT)$72.54 $84.00BuyHigh    
Peel Hunt ReiteratesSavills (SVS)GBX 931.50HoldN/A    
UBS Group ReiteratesTalktalk Telecom Group (TALK)GBX 105.60NeutralN/A    
Berenberg Bank ReiteratesTransDigm Group (TDG)$559.78 $600.00BuyHigh    
National Bank Financial DowngradesTaseko Mines (TGB)$0.44Outperform ➝ Sector PerformN/A    
Seaport Global Securities DowngradesGreen Organic Dutchman (TGODF)$0.54Buy ➝ NeutralLow    
Peel Hunt ReiteratesTI Fluid Systems (TIFS)GBX 217.50BuyN/A    
Bank of America UpgradesTeekay Tankers (TNK)$2.39Underperform ➝ BuyHigh    
Peel Hunt ReiteratesTravis Perkins (TPK)GBX 1,527.50HoldN/A    
Cowen UpgradesTripadvisor (TRIP)$31.14Underperform ➝ Market PerformMedium    
BMO Capital Markets ReiteratesTwitter (TWTR)$29.25 $33.00Market PerformLow    
Mizuho ReiteratesUnity Biotechnology (UBX)$6.54 $33.00BuyLow    
Stifel Nicolaus DowngradesUltra Clean (UCTT)$22.64Buy ➝ HoldLow    
Deutsche Bank Set Price TargetPeugeot (UG)€23.12 €26.00NeutralN/A    
Stephens DowngradesUS Concrete (USCR)$43.07Overweight ➝ Equal WeightHigh    
Warburg Research Set Price TargetUnited Internet (UTDI)€30.13 €52.80BuyN/A    
Peel Hunt ReiteratesVan Elle (VANL)GBX 38HoldN/A    
UBS Group UpgradesVirgin Australia (VBHLF)$0.10Sell ➝ NeutralLow    
Goldman Sachs Group UpgradesVenator Materials (VNTR)$3.94Neutral ➝ BuyHigh    
Berenberg Bank ReiteratesVodafone Group (VOD)GBX 153.10 GBX 175BuyN/A    
JPMorgan Chase & Co. Set Price TargetVolkswagen (VOW3)€176.20 €176.00BuyN/A    
JPMorgan Chase & Co. UpgradesViaSat (VSAT)$71.83Neutral ➝ OverweightLow    
Morgan Stanley DowngradesWorkday (WDAY)$165.98Overweight ➝ Equal WeightHigh    
Leerink Swann DowngradesWright Medical Group (WMGI)$29.51Outperform ➝ Market PerformLow    
Bank of America UpgradesWestrock (WRK)$39.96Neutral ➝ BuyLow    
Peel Hunt Lowers TargetWorks co uk (WRKS)GBX 41.10GBX 100 ➝ GBX 75BuyN/A    
Argus UpgradesWolverine World Wide (WWW)$33.30Hold ➝ BuyHigh    
National Securities DowngradesYield10 Bioscience (YTEN)$0.15Buy ➝ NeutralLow    

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Terms like “Buy”, “Sell”, and “Hold” are synonymous with financial analysts’ reports, yet very few people have a clear understanding of what they are and the best way to use them for value generation in the stock market.  The terms are usually the result of thorough investigations carried out by brokerage firms and analysts as they look to make it easy for investors to make informed decisions about investments.

Market ratings are a multi-level recommendation system based on facts and the opinion of a financial analyst. The fact that there is a multitude of firms issuing differing ratings and a lack of a standard terminology explains why it is essential to understand what the ratings are all about and their meaning before using them for investment decisions.

What Are Stock Ratings

A stock rating refers to an evaluation of a stock’s expected performance in a given time period.  The rating is usually accompanied by a target price that analysts or brokerage firm issue with the aim of helping clients understand what is the fair price of a stock compared to its market value.

A stock rating will often come with a price target that shows what analysts believe is the fair value for the stock. Whenever the price target exceeds the market value, then it implies analysts believe the stock is a buy.  If the market price for the stock exceeds the target price, analysts or brokerage firms would say that the stock is a sell.

Understanding Analysts Stock Ratings

Analysts' ratings range from a simple buy, sell or hold to an equal-weight, overweight or outperform. Many brokerage firms rate a stock on a scale of one to five stars, with five being the highest rating. The ratings are assigned depending on the kind of earnings the company has reported or what it is expected to report as well as on valuations and stock price.

Corporate governance, as well as the scalability of a company’s business, are also taken into consideration when rating stocks. Analysts also pay close attention to a company’s competitive edge in the industry, as it is known to affect performance most of the time.

Market conditions also play into how stocks are rated. For example, in a bull market, analysts are usually swayed to keep favorable ratings for a long time while upgrading share price target. Conversely, during a bear market, analysts may resort to downgrading stock ratings.

While ratings may seem straightforward to an investing newcomer, in reality, a rating from one brokerage firm may mean an entirely different thing in another firm. For example, an outperform rating issued by one firm may mean a buy for another firm, while a sell may mean under­perform.

When it comes to integrating analysts' ratings, it is important first to review a firm’s rating scale to get a full understanding of what it is all about and what it means.  For example, a stock with the potential of delivering a 15% upside in price may be rated as a buy while one with a 5% upside rated as a hold.

Types of Stock Ratings

Buy Stock Rating: A buy rating indicates that a stock is worth buying at a given market price as it is destined to rise. Some firms use ‘strong buy’ to indicate how confident they are that a stock will climb higher given the strong fundamentals backing a move on the upside.

Sell Stock Rating: Sell recommendations are normally issued whenever analysts believe a stock is overvalued or fundamentals do not add up to support any movements on the upside. Some firms use ‘strong sell' to indicate that it is time to liquidate the security.

Hold Stock Rating: A security hit with a hold rating is most of the time expected to perform at the same pace as other stocks in the sector.

Underperform:  Analysts issue an underperform rating whenever they feel a stock is likely to fair worse than the overall market.  The rating is most of the time expressed as a moderate sell, warning investors who are long that a stock is losing upside momentum.

Outperform Stock Rating:  An outperform rating indicates that a stock is likely to perform much better than the market when it comes to returns. Also known as moderate buy or overweight, the rating hints at an uptrend gaining momentum.

It is important to read each rating definition to have a clear understanding of what it means given that ratings from different firms do differ a great deal.  Some ratings do offer specific recommendations while others are usually general in nature. One firm may say it expects a stock to appreciate by between 10 and 20% while another firm may say it expects a stock to appreciate over the next 12 months.

Brokerage Firm

Buy

Strong Buy

Out­perform

Hold

Sell

Under­perform

BB&T Capital Markets

 

Esti­mated return of greater than or equal to 25%

 

Esti­mated Total Return  greater than or equal to 0%

 

Esti­mated Total Return of Less than 0%

Blay­lock Partners

Stock Expected to out­perform market indexes by 20%

 

 

Expects stock to track recog­nized market indexes

Expects stock  to under­perform the overall market by 20%

 

Barring­ton Research

 

Expected to out­perform the market over the next 6 months

Expected to out­perform the market over the next 12 months

 

Expected to significantly under­perform the market as a result of deterior­ating fundamentals

 

Brean Murray & Co

Stock expected to out­perform the market over the next 12 months with moderate risks to funda­mentals

Stock expected to out­perform the market over the next 12 months it minimal risks to funda­mentals

 

Expected to perform in line with the market over the next 6-12 months

Exacted to under­perform the market over the next 6-12 months with high risk to funda­mentals

 

Deutsche Bank  Securities

Stock poised to outperform the market by 10% or more over the next 12 months

Repre­sents firm best picks with a high degree of confi­dence. Stock expected to out­perform the market

 

 

 

Stock expected to under­perform the market by 10% over the next 12 months

Jefferies & Co

A stock is expected to appre­ciate by 20% or more. The total return should exceed the industry average

 

 

Stock expected to change plus or minus 10%. The total return should be  in line with the industry's average

Stock expected to decrease by more than 10%

 

 

Why Stock Ratings Matter

While investors have a love-hate relationship with stock analysts’ ratings, they still matter a lot, as they convey how professionals feel about a given security. They will always stand out in part because they are the result of reasoned and objective analysis of experienced professionals.

Analysts and brokerage firms spend a good amount of time and effort to analyze companies in a bid to come up with accurate stock ratings that investors can rely on for making informed investment decisions. Investors should always remember that analysts do their best with stock ratings to find good investments for their clients in order to secure their reputation in the industry as well as the commissions they earn for such pieces of information.

Legitimate ratings will always be valuable pieces of information that investors can rely on to beat the market and in the process generate substantial returns. However, while it is essential to always be on the lookout for analysts’ ratings, it does not mean that investors should always adjust their position based on such reports.

Such reports should only be used to complement individual research work prior to making an investment decision.  Stock analysts’ reports should thus be used to find a company with a durable competitive advantage.

Stock ratings are a great place to start when selecting stocks

Stock analysts' rating pages are a great place to start when looking for potential stocks to invest in. Such recommendations go a long way in providing insight on stocks that are performing and likely to perform even better going forward.

Reputable analysts and brokerage firms issue recommendations upon carrying out extensive research of a company’s operations and performance. The analysis also takes into consideration some of the market conditions that are likely to affect a company in the long run.

By going through such research pages, one can get an insight on where to start when carrying out due diligence on the stocks to invest in. In addition, such reports may provide common investment strategies that one can deploy on a given stock to be able to generate some returns.

Before making an investment decision, it is essential to consider analysts' ratings in addition to other metrics. Analyst’s ratings are never 100% accurate, which means they cannot be taken at face value.  That said, it is important to analyze everything from P/E ratio to earnings per share as well as dividends, risk, and growth of financial strength.

The key to success is analyzing below the surface when it comes to stock analysts' ratings. Never assume that just because a stock is rated a buy, it means it can be bought at any time at any price.

Bottom Line

Analysts’ recommendations in the form of stock ratings are the foundation of equity research reports that should always be used in combination with other personal research work for investment decisions. Buy, sell and hold recommendations should never be put to use without first understanding a firm’s entire scale of ratings.

It is also important for investors to note that analysts and brokerage firms also have agendas. While an analyst's obligation should be to retail shareholders, in reality, that is not always the case.

Some analysts are employed by institutions that own stakes in companies they have already initiated coverage on. Large financial firms, as well as hedge funds and securities, do benefit from certain analyst ratings. When such sums are at stake, it is common for these analysts to issue ratings that are favorable to their holdings, which may not be an accurate reflection of the market conditions.

However, that does not mean that an analyst’s ratings are useless. Analyst's stock research reports do contain vital information. Such information when complemented with other information found by carrying out due diligence could go a long way in helping one make a profitable investment decision.  Stock ratings should always be used as a source of data that complements one's research rather than completes it.

 


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