at last someone call them with the right name (I
Post# of 658
Despite a stronger than expected report on gross domestic product, more political scandal caused the stock market to end the week on a sour note. Valuations are high, earnings growth is low and the bull market is now seven and a half years. Investors keep proving that they are still willing and able to buy market pullbacks. These same investors are looking for new ideas for gains or dividends now.
24/7 Wall St. reviews dozens of analyst upgrades and downgrades each day. Some of these analyst calls cover stocks to buy, and some cover stocks to sell or avoid. By the end of the week, we have generally ended up going over hundreds of research reports.
Most Dow and S&P 500 stocks are currently given implied upside of just 8% to 15% with their Buy and Outperform ratings. In small cap stocks, and in stocks with share prices trading under $10 per share, the implied upside targets can be far more. Some may be 25%, but some analyst reports still can predict upside of 50%, 100% or more.
Investors need to understand that there are many more risks in small cap and low-priced stocks. In some cases there can even be existential risk. Yes, some of these companies could actually implode or just close down. Analysts also can be very wrong, when their assumptions of future value were just too optimistic, or management teams can make wrong decisions or they can deceive shareholders into thinking the upside was much greater than the reality.
Don't be afraid to be outnumbered. Pigeons flock together. Eagle fly alone