For Immediate Release
Chicago, IL – June 25, 2018 - Stocks in this week’s article include: QuinStreet, Inc. QNST, Hollysys Automation Technologies Ltd. HOLI, ION Geophysical Corp. IO and ZTO Express (Cayman) Inc. ZTO.
Screen of the Week of Zacks Investment Research:
4 Stocks Making the Most of New Analyst Coverage
As analysts are the key information intermediaries in capital markets, initiation of coverage by them offers critical information on a stock and is of great value to investors.
Coverage initiation by analyst(s) on a stock portrays higher investor inclination. Investors, on their part, often assume that there is something special in a stock to attract analysts’ interest. In other words, they believe that a company coming under coverage has value that can’t be ignored.
Obviously, stocks are not randomly chosen to cover. New coverage 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 ratings on continuously covered stocks.
It is worth mentioning here that the average change in broker recommendation is always preferred over a single recommendation change.
New Analyst Coverage & Impact on Price Movement
The price movement of a stock is the function of the recommendations on it from new analysts. Typically, stocks see an upward price movement on new analyst coverage compared to what was witnessed 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.
Meanwhile, investors start paying more attention to the stock (that has very few or no existing coverage) on which an analyst provides a new recommendation. Also, any new information attracts portfolio managers to build a position in the stock.
Below, we have selected five 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/308822/4-stocks-to-make-the-most-of-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.
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Contact: Jim Giaquinto
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ZTO EXPRESS INC (ZTO) : Free Stock Analysis Report
QuinStreet, Inc. (QNST) : Free Stock Analysis Report
Hollysys Automation Technologies, Ltd. (HOLI) : Free Stock Analysis Report
Ion Geophysical Corporation (IO) : Free Stock Analysis Report
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