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Equity Research Analyst's Stock Ratings - What Do the Analysts's Stock Recommendations Mean

Equity Research Analyst's Stock Ratings - What Do the Analysts Stock Recommendations Mean

Not all stock research firms use the same stock recommendation system. Therefore I have created the following reference table in which an explanation of the equity research analysts's stock ratings are explained.

For those readers who would like to know what I think of the equity research analysts's stock ratings and recommendations, I refer you to the first note at the bottom of this page.

In the second note at the bottom of this page, I explain which source I use to inform myself about the analysts's stock ratings of specific stocks I am interested in.

Indication  Stock Rating  Explanation 
Positive ↑  Strong Buy / Top Pick  This category consists of companies which have the best potential to significantly outperform the market, according to the analyst.
Buy  This category consists of companies which are expected to outperform the market, according to the analyst.
Speculative Buy  According to the analyst, this category consists of companies which are expected to outperform the market, if anticipated events happen.
Outperform / Overweight / Accumulate  According to the analyst, this category consists of companies which are expected to modestly outperform the market. The analyst recommends to add the company's stock on price weakness or improved fundamentals.
Neutral  Hold / Neutral / Market Perform / Sector Perform / Peer Perform / Equal-Weight / In-Line  This category consists of companies which are expected to perform in-line with the market, according to the analyst. These companies are fairly valued at current price level.
Negative ↓  Underperform / Underweight / Reduce  This category consists of companies which are expected to underperform the market, according to the analyst. The analyst recommends to sell the company's stock on price strength.
Sell  This category consists of companies which are expected to significantly underperform the market, according to the analyst. The analyst recommends to sell the company's stock at once.

If you are interested in the exact meaning behind each rating I recommend you to visit Marketwatch's website, who have provided their own guide to analyst recommendations, by clicking the link provided.

 

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Note: An equity research analyst's stock rating does not have any influence on my own stock investment analysis. Therefore it's not included in the stock investment analysis of the stocks in my stock portfolio. However, I do inform myself about the analysts' stock recommendations, related to the stocks in my portfolio, as I believe the change in their stock ratings can have an effect on the short term price movement. On the Monitor Your Portfolio page I explain how I inform myself about news related to the stocks I follow closely, so that I am automatically informed when a analyst updates its stock recommendation.

Note: If you are interested to inform yourself about the research analysts's stock ratings related to a specific stock, I recommend you to visit the website of the Analyst Research Network by clicking this link. This website covers stock ratings for all major U.S., U.K. and Canadian stocks. There is also limited coverage of Australian and continental European equities.

 

What Type of Content Can You Expect to Find on UndervaluedEquity.com

Main Section  Description 
News (RSS)  Today's News Related to the Global Energy and Mining Stocks. On this page a RSS feed is displayed with stock market news related to the energy and mining sectors. You can subscribe to this free RSS feed too!
My Due Diligence  How I Conduct My Stock's Due Diligence Investigation Process. If you want to know what I learned while I was conducting my due diligence, I recommend you to read all the chapters of the investigation process.
My Stock Watchlist  Are These the Best Stocks to Buy Today. In my stock watchlist you find stocks who offer great potential, but at the time I analysed these stocks they didn't comply with all my guidelines from my due diligence chapters. 
My Stock Portfolio 

Are These the Best Shares to Buy Now. As the year 2015 has just started, I believe it's about time that I share my stock portfolio with you. Therefore, you will find my updated stock portfolio on this page.

 

 

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About Jeroen Snoeks

Jeroen Snoeks - UndervaluedEquity.com

Jeroen Snoeks is the founder of UndervaluedEquity.com, a website for investors passionate about investing in undervalued stocks. Through UndervaluedEquity.com, he shares his experience and knowledge and will soon reveal his personal stock portfolio.


 
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