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It caught my attention when I heard an analyst on a popular financial news program tell investors to sell a stock because too many analysts liked the company, citing the fact that there were no sell ratings. It seemed perfectly logical to me that analysts wouldn't be telling investors to sell 3M (MMM), which has one of the most consistent positive earnings records in the history of the stock markets. Article: It transfixed my cognizance when I heard an psychiatrist on a popular financial news program tell investors to sell a stock as things go too many analysts liked the company, citing the fact that there were no sell ratings. It seemed perfectly logical to me that analysts wouldn’t be telling investors to sell 3M (MMM), which has one of the most consistent positive earnings records in the history of the stock markets. But living soul suspicious of conflicts of interest retailing firms and analysts I decided to do a bit of fact confirmation anyway. While the stock did not have any sell ratings at the time of writing, there were quite a few hold ratings. Now I feel obliged to diverge here and say that the hold rating seems quite illogical to me. If a stock is good enough to hold it’s good enough to buy, and vice versa if you wouldn’t want to buy it then you shouldn’t want to hold on to it either. As it turns out, the pair off rating for 3M was only slightly and insignificantly turn upside down than the middle point for all stocks in the Dow Jones Industrial Average, of which the in-group is a component. But what was most interesting in re the ratings on Dow components was that, despite numerous and serious legal problems, AIG (AIG) was tied with General Electric (GE) and Du Pont (DD) for the third best rating, only routed by Citigroup (C) and Microsoft (MSFT). AIG was really-truly more highly recommended by analysts than J.P. Morgan Chase’s (JPM) and American Express (AXP). This didn’t do much for my confidence in analyser ratings. So I dug a little deeper looking at the more statistically significant S&P 500. What I found was that companies in the index with the worst revenue performance did really-truly haulage more sell ratings than companies with the best performance. At least analysts were using the sell rating, something they seldom did in the past. There was, however, a significant bias towards the neutral ‘Hold’ rating for all stocks indicating reluctance on the part of analysts to offer to buy and sell recommendations. Article Index: | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 | 19 | 20 | 21 | 22 | 23 | 24 | 25 | 26 | 27 |
More Articles:1. Have Analysts Gotten Honest? By Mark Mahorney Summary: It caught my attention when I heard an analyst on a popular financial news program tell investors to sell a stock because too many analysts liked the company, citing the fact that there were no sell ratings.It seemed perfectly logical to me that analysts wouldn't be telling investors to sell 3M (MMM), which has one of the most consistent positive earnings records in the history of the stock markets. Article: It transfixed my cognizance… 2. A Safe Port For Mutual Funds But Not You! By Dr. Scott Brown, Ph.D. Summary: Soft dollars, a form of legal kickback, is a sly way you can get ripped off by mutual fund managers. The best way to avoid these losses altogether is to restrict your purchases of mutual funds to your 401(k) and try to only buy indexed mutual funds such as the Vanguard 500 (VFINX). Article: Soft dollars, a form of legal kickback, is a sly way you can get ripped off by mutual fund managers. Full service brokers give these kickbacks … 3. Investing and Asset Allocation By Ioannis - Evangelos Haramis Summary: It takes advantage of the fact that when it comes to risk and reward, financial categories like stocks, bonds and money-market (cash equivalent) accounts all behave quite differently!Stocks, for instance, offer the highest returns among those three "asset classes," but they also carry the highest risk of losses.Bonds aren't so lucrative, but they offer a lot more stability than stocks.Money-market returns are puny, but you'll never lose … 4. Investments and Tracking Your Return on Investments By Fauzi Zamir Summary: The calculation gets more complex when: You have multiple portfolios at different financial institutions and you want to calculate individual portfolio returns or a rate of return for all your portfolios on a combined basis. You have made contributions or withdrawals during the calculation period which then have to be weighted for accurate return calculations. You don't have access to Index rates of returns for comparison purposes. How … |