Stock analysts have taken their fair share of criticism in
Some so-called experts are consistently off-the-mark and issue
earnings projections that seem to be little more than guesstimates.
Others simply follow the herd and are reluctant to raise or lower
their outlook until a day or two after the company itself provides
its latest bearing. Anyone can predict yesterday's weather.
And then there's the inherent conflict of interest that arises
whenever an analyst covers a company that also happens to be a key
investment banking customer. Brokerage firms seldom jeopardize
those relationships by printing bearish comments, which is why you
see far more "buys" than "sells".
But some analysts are razor-sharp observers with impressive
credentials and a granular understanding of the specific sectors
they have been assigned. These analysts' forecasts wield the power
to move the market and send stocks soaring or crashing.
Many companies claim to have the most astute stock pickers, but in
many respects Raymond James is a cut above the rest. The firm
boasts a talented team of 90 senior analysts and research
associates, which are in turn supported by economists, equity
strategists and other experts.
Raymond James has racked up some impressive accolades. In fact, 19
different RJ analysts have taken home the prestigious
Wall Street Journal
"Best on the Street" award. Jim Parker, who covers the airline
industry, has won seven first place trophies all by himself, for
example. And last year, 12 of his colleagues were named to the
Forbes "Blue Chip Analyst" survey for superior estimate accuracy
and stock selection.
Such recognition is nice of course, but the numbers speak for
themselves. Last year, Raymond James' Best Picks list delivered an
impressive average return of +54%, versus +33% for the S&P 500.
That outperformance is nothing new -- the firm has topped the
market 13 of the past 14 years.
Typically, these recommendations are disseminated to the firm's
high net-worth clients. But you don't need a million dollar account
to have access to Raymond James' all-star analysts. Thanks to the
Claymore/Raymond James SB-1 Equity (NYSE:
exchange-traded fund (
, you can get the inside scoop and own a cherry-picked basket of
the firm's best ideas, for a reasonable charge of just 0.75%.
The fund tracks the Raymond James SB-1 Equity
, an equal-weighted
solely reserved for the select few stocks deemed "Strong Buy"
according to the firm's analysts. These standouts are expected to
hit their price targets within six to 12 months.
The 120-stock portfolio spans the market-cap spectrum -- roughly
one-quarter is invested in large-caps like
Home Depot (NYSE:
. From a sector standpoint, the bulk of the fund's assets are sunk
in technology, financial, energy and consumer discretionary stocks.
These are the firm's analytical sweet spots, so it's not surprising
to see the fund ante up in these areas.
Based on Raymond James' exemplary track record, you can probably
guess that shareholders have done well. And they have -- RYJ has
climbed more than +30% in the past 12 months, outrunning the
S&P's +18% gain. The fund has also outrun 99% of its peer group
during the past three years.
Action to Take -->
I view RYJ as a solid core domestic stock fund and will be
watching it as a potential portfolio candidate for my premium
The ETF Authority
The fund is a direct bet on the stock-picking ability of Raymond
James' seasoned analysts. That bet has paid off time and again
during the past decade, and there's no reason to think it won't
continue doing so. You don't beat the S&P 13 out of 14 years by
Editor: Market Advisor, The ETF Authority
Disclosure: Nathan Slaughter does not own shares of any security
mentioned in this article.