Analysts

Re: Analysts

Postby winston » Sat Sep 18, 2010 9:20 am

Analyst's Coverage

Recently, I was talking to an Equities Sales person.

I discussed with her, a stock that I had been following for a long time.

I then asked her why her IB does not cover this stock. The numbers looks good, the PEG is fantastic, it's in an industry that's fantastic, there's repeat purchase of it's products etc. In short, it's a Peter Lynch potential multi-bagger...

Her short reply was that their Analyst is wary of the company. Their Analyst has no condidence that Management is honest.

Then it hit me in the head. There's actually no Analyst covering this particular company despite it's fantastic numbers, the great industry etc.

I then promptly sold all the stocks that I have on this company.

Lesson Learnt: If it's too good to be true, it probably is. There's thousand of Analysts are there and if they are not covering your "fantastic" company, there's probably a good reason for it...
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Re: Analysts

Postby helios » Sat Sep 18, 2010 9:43 am

Here is the caveat.

How could one determine business ethics and management if one doesn't have real insights?
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Re: Analysts

Postby kennynah » Sat Sep 18, 2010 9:45 am

Recently, I was talking to an Equities Sales person.
I discussed with her, a stock that I had been following for a long time.


....and then, it began to rain.... :lol:
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Re: Analysts

Postby winston » Sat Sep 18, 2010 9:46 am

San San wrote:Here is the caveat.

How could one determine business ethics and management if one doesn't have real insights?



When you are talking to a person, you can "feel" it.

If there's a lot of excuses, if their eyes are always shifting, if they cant give you straight answers etc... all these are warning signs ...
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Re: Analysts

Postby winston » Sat Sep 18, 2010 11:52 am

winston wrote:Analyst's Coverage

Recently, I was talking to an Equities Sales person.

I discussed with her, a stock that I had been following for a long time.

I then asked her why her IB does not cover this stock. The numbers looks good, the PEG is fantastic, it's in an industry that's fantastic, there's repeat purchase of it's products etc. In short, it's a Peter Lynch potential multi-bagger...

Her short reply was that their Analyst is wary of the company. Their Analyst has no confidence that Management is honest.

Then it hit me in the head. There's actually no Analyst covering this particular company despite it's fantastic numbers, the great industry etc.

I then promptly sold all the stocks that I have on this company.

Lesson Learnt: If it's too good to be true, it probably is. There's thousand of Analysts are there and if they are not covering your "fantastic" company, there's probably a good reason for it...


Over the years, I have had invested in some pretty lousy companies.

And thinking about it, these lousy companies did not have a lot of Analysts coverage.
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Re: Analysts

Postby winston » Sat Nov 06, 2010 1:40 pm

If a company has been announcing a lot of contract wins but has no corresponding rise in Revenue, I'm sure that the company would be questioned by the Analyst covering the company.

But what happens if there's not many analysts covering the company and the investment house is interested in Inv Banking business with company?

Would you then see the negative stuff in the Analyst report eg announced contract wins not matching Revenue ?

When there's only a few analysts covering a perceived hot company, it's a warning sign. Some of the analysts have already analysed the company but the house has decided not to publish the analyst report.
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Re: Analysts

Postby winston » Thu Jan 20, 2011 7:33 am

APPLE MAKES A MOCKERY OF THE SYSTEM – AGAIN….

It’s really not shocking that small investors believe Wall Street is a rigged game. There is, perhaps, no better example of this than Apple’s quarterly report.

For anyone who isn’t familiar with how the game works I’ll break it down for you.

Apple provides an outlook for the upcoming quarter. They set these figures WELL below expectations with the knowledge that they will soundly crush those figures.

The analysts, all of whom rely on being able to “sell” Apple want to stay in management’s good graces. This is important because Apple is widely held by most of their clients.

For instance, there isn’t a huge hedge fund on Wall Street that doesn’t own Apple.

So, the research firms (which are supposedly independent of their sales and trading arms) are incentivized to ensure that Apple stock continues to rise and perform
“better than expected”.

The pay-off of course, comes in the form of millions in commission dollars.

http://pragcap.com/apple-makes-a-mocker ... stem-again
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d**k Bove

Postby winston » Wed Nov 30, 2011 7:14 am

Listen to the "expert" analysts at your own risk ...

The d**k Bove Mea Culpa

No one lost you more money this year than fundamental sell-side analysts "covering" the bank sector. Oh my god. Bank of America is down like 70% this year and the rest of them have all been proportionately slaughtered.

In the sell-side brokerage research world, the term "covering a sector" sometimes means trying to find the name that's the least bad so they have something to pitch to clients.

And none of the sell-side fundamental analysts covering the bank sector has lost you more money than d**k Bove of Rochdale Securities.

This guy was on television everywhere you looked all year (thanks to his media connections, not his track record or the timeliness of his calls).

Bove was telling you to buy BofA and Citi, dismiss the bearish economic arguments, treat MF Global's sell-off as "overblown" and get long Jefferies as a takeover target.

No other bank analyst had more face time in 2011 and no other bank analyst did more damage to the knife-catching public.

http://www.thereformedbroker.com/2011/1 ... mea-culpa/
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Re: Analysts

Postby winston » Sun Dec 25, 2011 10:01 pm

Maybe fund managers have been listening too much to bullish stock analysts.

For the record, the same analysts surveyed by S&P who expect a 16 percent stock jump next year, were optimistic about 2011, too. A year ago, they called for the S&P to rise 9 percent.

Source: AP
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Re: Analysts

Postby winston » Sun Mar 04, 2012 5:35 am

Analysts Get More Bearish as Rally Rolls On By Michael Baron

NEW YORK (TheStreet) -- Wall Street analysts are historically a bullish lot but the 20%-plus surge in the major U.S. equity indices since early October has eroded some of that optimism of late.

According to FactSet Research, the total percentage of buy ratings for S&P 500 companies has dropped to 51% as of March 1 vs. 54% on Dec. 31. The slack was picked up by hold ratings, which went to 44% from 42%, and sell ratings, now 5% vs. 4% at year-end. Those percentages are based on a total of 11,035 ratings on S&P 500 companies, FactSet said.

This was the second month in a row that analysts reduced their buy ratings, while increasing hold and sell ratings. Seven of the 10 sectors within the index saw a decrease in buy ratings with the financials, a market leader so far this year, hit hardest with a 5% decline.

Interestingly, the target prices of analysts have climbed higher even as they've tempered their recommendations. FactSet said 369 of the 500 companies in the S&P 500 -- 74% -- have seen an increase in their mean target price since the start of 2012.

That's pushed the bottoms-up price target for the S&P 500 to 1503.03, up 3.3% so far this year.

http://www.thestreet.com/story/11442078 ... ooyah_html
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