Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel , we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the First Trust NASDAQ-100 Ex-Technology Sector Index Fund ETF (Symbol: QQXT), we found that the implied analyst target price for the ETF based upon its underlying holdings is $47.17 per unit.
With QQXT trading at a recent price near $42.75 per unit, that means that analysts see 10.33% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of QQXT's underlying holdings with notable upside to their analyst target prices are (Symbol: LBTYA), DENTSPLY SIRONA Inc (Symbol: XRAY), and O'Reilly Automotive, Inc. (Symbol: ORLY). Although LBTYA has traded at a recent price of $35.23/share, the average analyst target is 21.85% higher at $42.93/share. Similarly, XRAY has 17.03% upside from the recent share price of $56.91 if the average analyst target price of $66.60/share is reached, and analysts on average are expecting ORLY to reach a target price of $306.71/share, which is 15.28% above the recent price of $266.07. Below is a twelve month price history chart comparing the stock performance of LBTYA, XRAY, and ORLY:
Below is a summary table of the current analyst target prices discussed above:
|Name||Symbol||Recent Price||Avg. Analyst 12-Mo. Target||% Upside to Target|
|First Trust NASDAQ-100 Ex-Technology Sector Index Fund ETF||QQXT||$42.75||$47.17||10.33%|
|DENTSPLY SIRONA Inc||XRAY||$56.91||$66.60||17.03%|
|O'Reilly Automotive, Inc.||ORLY||$266.07||$306.71||15.28%|
Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.