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Zacks.com featured expert Kevin Matras highlights: Shenandoah Telecommunications, Honda Motor, PolarityTE, Ubiquiti Networks and Titan Machinery

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For Immediate Release

Chicago, IL – February 25, 2019– Stocks in this week’s article include Shenandoah Telecommunications Company (SHEN - Free Report) , Honda Motor Co., Ltd. (HMC - Free Report) , PolarityTE, Inc. (PTE - Free Report) , Ubiquiti Networks, Inc. (UBNT - Free Report) and Titan Machinery Inc. (TITN - Free Report) . Kevin Matras screens for companies showing their 'first' profit and explains why they are ones to watch.

Screen of the Week written by Kevin Matras of Zacks Investment Research:

5 Stocks to Buy as New Analysts Initiate Coverage

New analyst coverage unearths extensive data on stocks for investors. Analysts are privy to vital information, which is crucial for investment decisions. Lack of information creates chances of misinterpretation of stocks (over- or under-valued).

Coverage initiation on a stock by analyst(s) usually portrays higher investor inclination. Investors, on their part, often assume that there is something special in a stock to attract analysts to cover it. In other words, they believe that the company coming under the microscope definitely holds some value.

Obviously, stocks are not randomly chosen to cover. New coverage on a stock usually reflects a reassuring future envisioned by the analyst(s). At times, increased investor focus on a stock motivates analysts to take a closer look at it. After all, who doesn’t like to produce something that is already in demand? Hence, we often find that analysts’ ratings on newly added stocks are more favorable than their ratings on continuously covered stocks.

Needless to say, the average change in broker recommendation is preferred over a single recommendation change.

Impact on Stock Price

The price movement of a stock is generally a function of the recommendations on it from new analysts. Stocks typically see an upward price movement with a new analyst coverage compared to what they witness with a rating upgrade under an existing coverage. Positive recommendations — Buy and Strong Buy — generally lead to a significantly more positive price reaction than Hold recommendations. On the contrary, analysts hardly initiate coverage with a Strong Sell or Sell recommendation.

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 over the last few weeks.

For the rest of this Screen of the Week article please visit Zacks.com at:https://www.zacks.com/stock/news/356447/5-stocks-to-buy-as-new-analysts-initiate-coverage

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

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine.  But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.

Strong Stocks that Should Be in the News

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