Stocks - What do analyst recommendations really mean? |
- What do analyst recommendations really mean?
- Do you have stocks you believe can grow like Shopify?
- The ticker to rule them all
- Golden rules for investing
- Would you guys prefer VOO or SPY?
- Cloud Computing Stock
- Stocks will drop if Real Estate collapses.
- Who do folks recommend for fractional share brokers?
- Casino/hotel stocks
- Week of May 11
- $HEAR up on Monday
- $BAM
- Septic business
- Autonomous vehicle stock
- Stocks to watch week of May 11
- $SQ -Square ceiling?
- Uk equivalent ETF’s
- Profit Taking
- Advanced stock screeners
- DFS and SYF headroom?
- FZILX AND FZROX
- The Intelligent Investor
- Futures will be green with a green open
| What do analyst recommendations really mean? Posted: 10 May 2020 06:41 AM PDT Often I see people either taking analyst recommendations seriously, or saying that Wallstreet analysts are a bunch of idiots. Neither is true. The important thing to understand here is that it's actually not their job to help retail investors (you) make money. Here's how Wallstreet actually works: Most research analysts work for banks. You probably know that these analysts get paid very good salaries. But research in and of itself doesn't generate revenue. So how is their existence justified? Let's first talk about how banks actually make money. Banks generate revenue via corporate activities – these include both equity and debt financing deals – when a company sells new stock to investors, Wallstreet takes a clip. They also take a clip when a company issues new debt. It is true that investors pay Wallstreet some commissions to trade stock and to consume research, but those are dwarfed by fees for facilitating debt and equity issuance. Wallstreet also makes big fees when companies buy one another, so called mergers and acquisitions. So as a bank, you want to do everything you can to get a company to choose you when they are selling additional securities. How do they do this? Well one good way is to write flattering research about the company. A research analyst at an investment bank is not supposed to make recommendations that help investors make money, the research analyst is supposed to make recommendations that maintain good relations with the company, so that their ECM, DCM and M&A teams can get deals that make the bank money. If we take an example – some people have asked me why do research analysts keep upgrading Tesla's stock price target as the share price goes up? No, it's not because they are stupid. No, it's not because they can't see that Tesla is more expensive than all the other US automakers combined. Yes, they can see that the stock price went up while Tesla stopped making cars. BUT Tesla is a company that requires a lot of money (maybe even more now due to their production delays)! And that means both equity issuance and debt issuance. The ECM and DCM bankers are sitting there salivating at the fees that they can make as long as Elon picks them as the lead bookrunner. And these are the guys that get paid the big bucks on Wallstreet – they go and have a word with the manager of the guy that writes about Tesla, a much lesser earner, and make it clear that they need their firm to stand out as the most bullish on the street, so that Elon chooses them for his next raise. Consequently all of Wallstreet falls over each other to keep upgrading in the hopes of getting into the company's good graces. It's twisted, but this is just how Wallstreet works. This is also why there are no upgrades for boring cheap and profitable companies. They don't need Wallstreet, so Wallstreet doesn't talk about them. On the other hand, if you are a money burning software company that pays their employees in stocks? No problem, no profits required – you will get upgrades. Research analysts are required to tie themselves into knots to justify any stock price, lest their delicious bonus will look an awful lot less delicious. The same goes for companies that like to make acquisitions – cash rich guys with a bit of an empire building streak – here Wallstreet wants to pander to them to make money on the acquisition streak – think Allergan before it blew up. Also companies that are in areas where a lot of M&A activity is going on – guys that may be purchased by said acquirers – Wallstreet wants to pump these up to make a bigger fee when they get taken out! Of course, the issue with buying into this is that it can blow up at any moment. Wallstreet can't manipulate the whole market. Wallstreet also doesn't care if Tesla goes to $300 and all the "suckers" (as they call them) who bought based on their recommendations lose money. Once Wallstreet can't make money out of a company, they don't care about it anymore. They will still be laughing all the way to the bank. TL;DR: Wallstreet analysts are a bunch of self-interested cheerleaders. Don't expect them to produce any actual research based on facts. Just like you, they want to make money. [link] [comments]  |
| Do you have stocks you believe can grow like Shopify? Posted: 10 May 2020 10:04 AM PDT Shopify soared incredibly in last 3-5 years. I just found this post down here. u/kdcurry must be rich right now! What are your gold stocks/companies you believe can behave similar and grow so rapidly? https://www.reddit.com/r/stocks/comments/6akic1/bros_wanna_be_a_millionaire_in_10_years [link] [comments]  |
| Posted: 10 May 2020 11:16 AM PDT If you had 100k to put into one stock within a week what would you choose? Have to hold for 5 years. Not advice, just a fun hypothetical on a Sunday [link] [comments]  |
| Posted: 10 May 2020 06:59 AM PDT I'd like everyone who sees this to comment your top rules you follow when you invest and/or trade to help out anyone at whatever level it may be! I'll start
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| Would you guys prefer VOO or SPY? Posted: 10 May 2020 12:56 AM PDT Planning on putting in $500 monthly when I start working again. These are two of the best funds out there. If I were to be holding for 10-20 years plus which would you prefer ? Pretty safe bet with both but just looking for opinions [link] [comments]  |
| Posted: 10 May 2020 01:01 PM PDT What are some of the best cloud computing stocks? Why? [link] [comments]  |
| Stocks will drop if Real Estate collapses. Posted: 10 May 2020 02:31 PM PDT I think we are in a period of literal FOMO and disclaimer I have a lot of stock right now and couldn't be happier seeing the portfolio green. But I think the trigger or first "domino" will be real estate. As the stimulus checks and assurances of the fed run out, and the aid not reaching the most affected, this will be the catalyst for a big drop. Large companies who are still operating today are cutting forecasts and initiatives for the year...this means contractors/vendors/jobs. Small businesses are getting routed...As mainly a real-estate investor for 20 years, people who are looking to sell their houses and particularly those who bought as investments, cannot sell due to the current environment and with no one able to get out to see places/registration offices closed. Once restrictions are relaxed even more, we will see the true nature of the economy, and I believe this starts with the banks. With a lot of people defaulting on mortgages buying at extremely high prices, they'll end up moving back in with their parents. This is something the FED cannot dictate, where my timeline is late September/ beginning of October. I'm all for holding a long time, but this is the only scenario where I could see a significant impact. [link] [comments]  |
| Who do folks recommend for fractional share brokers? Posted: 10 May 2020 07:46 AM PDT I want to buy fractional shares in these large stocks. Does anyone like who they use? [link] [comments]  |
| Posted: 10 May 2020 12:51 PM PDT I'm thinking about investing early this week in either MGM grand, the WYN or Park Hotels & Resorts Inc. Park has their earning report tomorrow (May 11) so I'm thinking they might have a dip after. Just wondering your guys thoughts. [link] [comments]  |
| Posted: 10 May 2020 09:28 AM PDT What are your thoughts on this coming week? I think is going to be green, lots of places opening up so im sure it will be positive. Probably even cruises, airlines. Yesterday was UFC 249 and they reported doubled ppv presales. [link] [comments]  |
| Posted: 10 May 2020 09:03 AM PDT $Hear beat earnings and and raised guidance yet went down on Friday, you are probably wondering why like I was. The reason for the dip on Friday can be explained by 2 factors. The first is profit taking by some who got in at $4-6 in March that saw this as a peak, I do not blame them, but this stock is just getting started. The second factor is that a sell wall was set up at $10 by short sellers to keep the day under $10. There is a large short interest in this stock currently trying to manipulate the price. Now that I have explained the downtrend it's time to tell you why the stock will crush on Monday and the next few months. The numbers for new guidance that were presented are modest at best. The company is factoring in sales being pulled forward from Christmas to now. This assumption is inaccurate due to two major factors. The first being that sales of consoles has been raised 155% since lockdown and the demand for headsets has followed that to an extent, however the demand for headsets will be more elongated as those who skipped out on a headset with their initial purchase realize the value of the product. This also plays heavily in turtle beach's favor, because a consumer that elects not to buy a headset due to extra cost initially and then in the future purchases one will likely buy a product in the sub $50 market where turtle beach dominates the market. The second factor is the launch of new consoles. Older model headsets will be compatible with the next gen console, however when a consumer elects to spend $400-500 on a gaming system it is easier to justify a $50 purchase to enhance your new product. This will be similar to the Fortnight boom the company experienced only this time enhanced by the release of new consoles. Ok so the stock is up 58% in the last month are the insiders cashing out? No, insiders have been accumulating shares over the past months. I forgot to mention they gained 500 points of market exposure in their main market, and gained exposure outside of the gaming market. Oh yeah and $0 debt! Ok so I showed why this is a good longterm investment now why would Monday be a huge day? The factors above combined with a big dip on Friday will lead to high interest in this stock on Monday. When this interest depletes the short's sell wall at $10 a break out will begin. This breakout will be amplified as the large short interests start to buy shares to close positions. "Short squeeze" To be transparent I do have calls on this stock. TLDR $HEAR earnings were good with modest projections, short squeeze on Monday or some time next week. [link] [comments]  |
| Posted: 10 May 2020 09:57 AM PDT What are your thoughts on $BAM. I'm thinking of buying around 20 shares coming Monday morning when the market opens. [link] [comments]  |
| Posted: 10 May 2020 04:56 AM PDT Seems like it's an industry with lots of small local players. With more people at home I expect much more business with pumping and services, anyone have any insight on how to get exposure to this market? [link] [comments]  |
| Posted: 10 May 2020 01:28 PM PDT What are some of the top autonomous vehicle stocks? Looking for long term speculative growth and a break from all the travel stock talk. [link] [comments]  |
| Stocks to watch week of May 11 Posted: 10 May 2020 05:23 AM PDT Bull/bear. What's on your radar to be the biggest mover? My eyes are on (bullish): TSLA CMG TWTR MFST ETSY [link] [comments]  |
| Posted: 10 May 2020 10:38 AM PDT I've been looking at SQ since it's last earnings where it seems like their Cash App side of the business is offsetting their commerce side. They've been rising steadily since and I wanted to ask if I should wait until next earnings where the commerce side will take an even greater hit? Or is the current price <$80 considered a discount already? [link] [comments]  |
| Posted: 10 May 2020 04:56 AM PDT I'm trying to compile a list of US, ETF's either with KID's or that have a UK Equivalent. Such as: QQQ being EQQQ. Any help/additions greatly appreciated. [link] [comments]  |
| Posted: 10 May 2020 11:42 AM PDT Profit Taking Hello Everyone! Fairly new to investing here and wondering how I should best prepare myself. I have invested, for the long term, in a stock, but I'm apprehensive about another downturn that might be on the horizon. Situation: The stock I'm in went saw a gain of 50%, in profit, but I didn't take any of it and now I'm down to 20%. I've seen people realize the profits that they earn from the stock and reinvest it back into the same stock. Questions:
Hopefully these questions make sense, looking forward to everyone's input! [link] [comments]  |
| Posted: 10 May 2020 11:26 AM PDT Is there any stock screener that produces tickers based on given criteria during historical periods? I want to look back on how a screener-based strategy might have worked during certain periods in the past and as far as I know TradingView and Finviz don't have this feature. Anyone got any ideas? [link] [comments]  |
| Posted: 10 May 2020 07:35 AM PDT I bought into DFS and SYF a few weeks ago and they have performed well for me. It looks like financials still have a lot of headroom to recover. I'm thinking about pumping more into the sector and pulling some to reinvest elsewhere after they recover. Right now I'm about 15% into financials, and the rest diversified favoring tech. This seems like a great idea to me, but I'm still learning about investing. What do y'all think? I had planned a similar strategy with airlines, but it looks like they will take longer to recover. Holding DAL, JETS, LUV, and BA. My goals are to hold roughly half my portfolio ~5yrs, and the rest long term. I'll contribute about $500/month to my investments. [link] [comments]  |
| Posted: 10 May 2020 09:08 AM PDT Zero fees. Seems like a no brainer to just pump a ton of money in to these two. Am I missing something? [link] [comments]  |
| Posted: 10 May 2020 10:49 AM PDT I am very new to trading and I had just recently bought The Intelligent Investor by Benjamin Graham. So far it's starting a little difficult. Do I read through it or are there other things I need to know before reading? [link] [comments]  |
| Futures will be green with a green open Posted: 10 May 2020 02:31 PM PDT Nothing bad over the weekend Bulls rollllll. It's a guarantee. SPX 3000 [link] [comments]  |
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