For Immediate Release
Chicago, IL – July 10, 2018 - Stocks in this week’s article include: Movado Group, Inc. MOV, BRT Apartments Corp. BRT, Integer Holdings Corp. ITGR, Hollysys Automation Technologies Ltd. HOLI and QuinStreet, Inc. QNST.
Screen of the Week of Zacks Investment Research:
5 Stocks to Buy on New Analyst Coverage
Many investors have utmost confidence in the research work of analysts as they fear that misinterpretations while researching on their own might trigger inefficiencies. Here, analysts play a vital intermediary role with their extensive access to relevant data.
Coverage initiation of a stock by analyst(s) usually portrays higher investor inclination. Investors, on their part, often assume there is something special in a stock to attract analysts to cover it. In other words, they believe that the company coming under the microscope definitely has some value.
Obviously, stocks are not randomly chosen to cover. New coverage on a stock usually reflects a reassuring future envisioned by the analyst(s). At times, increased investors’ focus on a stock motivates analysts to take a closer look at it. After all, who doesn’t love to produce something that is already in demand? Hence, we often find that analysts’ ratings on newly-added stocks are more favorable than their ratings on continuously covered stocks.
It is needless to say, the average change in broker recommendation is preferred over a single recommendation change.
How Does Analyst Coverage Influence Stock Price?
The price movement of a stock is generally a function of the recommendations on it from new analysts. Stocks typically see an upward price movement with a new analyst coverage compared to what they witness with a rating upgrade under an existing coverage. Positive recommendations — Buy and Strong Buy — generally lead to a significantly positive price reaction than Hold recommendations. On the contrary, analysts hardly initiate coverage with a Strong Sell or Sell recommendation.
Now, if an analyst gives a new recommendation on a company that has limited or no existing coverage, investors start paying more attention to it. Also, any new information attracts portfolio managers to build a position in the stock.
So, it’s a good strategy to bet on stocks that have seen increased analyst coverage over the last few weeks.
And that's what we're screening for today…
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/310656/5-stocks-to-buy-on-new-analyst-coverage
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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
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QuinStreet, Inc. (QNST) : Free Stock Analysis Report
Hollysys Automation Technologies, Ltd. (HOLI) : Free Stock Analysis Report
Integer Holdings Corporation (ITGR) : Free Stock Analysis Report
BRT Realty Trust (BRT) : Free Stock Analysis Report
Movado Group Inc. (MOV) : Free Stock Analysis Report
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