For Immediate Release
Chicago, IL – August 27, 2021 – Stocks in this week’s article are NBT Bancorp Inc. (
NBTB Quick Quote NBTB - Free Report) , Bio-Rad Laboratories, Inc. ( BIO Quick Quote BIO - Free Report) , RadNet, Inc. ( RDNT Quick Quote RDNT - Free Report) , Arbor Realty Trust, Inc. ( ABR Quick Quote ABR - Free Report) and Cathay General Bancorp ( CATY Quick Quote CATY - Free Report) . New Analyst Coverage Puts Spotlight on These 5 Stocks
Coverage initiation on a stock by analyst(s) helps in interpreting information pertaining to capital markets, thereby creating value for investors. Lack of information creates inefficiencies that might trigger misinterpretation of stocks (over- or under-valued).
In fact, coverage initiation usually depicts increased investor inclination. Investors, on their part, often assume that there is something in the stock that has attracted analyst attention. In other words, they believe that the company coming under the microscope definitely has some value.
Obviously, stocks are not arbitrarily chosen to cover. New coverage on a stock usually reflects an encouraging future envisioned by the analyst(s). At times, increased investor focus on a stock motivates analysts to take a closer look at it.
It is to be noted that the average change in broker recommendation is preferred over a single recommendation change.
Influence on Stock Price
It is interesting to note that the price impact of analyst initiation depends on the initial recommendation. Positive recommendations — Buy and Strong Buy — generally lead to a significantly positive price reaction in comparison to Hold recommendations. On the contrary, analysts hardly initiate coverage with a Strong Sell or Sell recommendation. Meanwhile, stocks typically see an upward price movement with a new analyst coverage compared to what is witnessed with a rating upgrade under an existing coverage.
Now, if an analyst gives a new recommendation on a company that has very few or no existing coverage, investors start paying more attention to it. Also, any new information attracts portfolio managers to build a position in the stock.
So, it's a good strategy to bet on stocks that have seen increased analyst coverage.
Below, we have selected five stocks that have seen increased analyst coverage over the past few weeks.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1787170/new-analyst-coverage-puts-spotlight-on-these-5-stocks Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. About Screen of the Week
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Strong Stocks that Should Be in the News
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