Analyst Recommendations - The NASDAQ Dozen
Analyst Recommendations
Now that you have determined the fundamental health of your stock, you will want to get an idea of what the professionals think about the stock by reviewing analyst recommendations. To find the analyst recommendations on a stock, click on Analyst Stock Research in the drop-down menu at the top of the screen. Once on the Analyst Research & Recommendations page, locate the Consensus Recommendation area (see Figure 11).
Importance of Analyst Recommendations
Analysts conduct extensive research on a stock and then issue a recommendation as to what they think the future holds for the company. If the company’s future outlook is positive, the analysts recommend a "buy." If the company’s future outlook is poor, then the analysts recommend a "sell."
Scoring Analyst Recommendations
- Pass—Give this factor a passing score if the consensus recommendation is a buy or strong buy.
- Fail—Give this factor a failing score if the consensus recommendation is a sell or strong sell.
Looking at the consensus recommendation for GOOG in Figure 11, it should receive a passing score. Out of 39 total analysts, 24 of them recommended a "buy" while 10 analysts recommended a "strong buy."
Analyst Recommendations: PASS
Figure 11—Analyst Recommendations
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