Stop Looking at the Analyst Reports, When Picking Your Stocks

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Yes, the reports of the analysts are beneficial to some extent. When we talk about the analyst’s report, it means the reports of the buy and sells. The reason to consider the reports to less extent is that sometimes they could be biased. It is needless to mention here that there can be individual companies that may reach out to the analysts to recommend their businesses with better performance. Or sometimes, the analyst himself or herself may be biased to a corporation and so the reports of the same company may be shown accordingly. Eventually, the statements of the analysts are more possibly skewed, and it is always better to pay less attention to the reports explained in such ways.

We know that the analysts are paid for particular tasks provided to him or her. They are paid for evaluation of the stock market and the raisings of the company, instead of taking all the positive and events to be recorded and shown. For example, if I am the analyst for Facebook, and I am paid by Facebook for evaluating its market, maybe one dollar per day or two dollars per day. There can be multiple analysts who are paid in the same way. If I go in my way, genuinely, I may contradict with the other analysts, who are in the same positions. I may be correct, and the other critics may be wrong. Or the other critics are right, and I am wrong. Eventually, my job would be in problem as the reports do differ and skewed. But at the end of the day, I want to keep or retain my job without the risk.

When the other analyst says 200 dollars and if the value is on the rise, I tend to say 210, and if the value is declining, I tend to say 195. My reports would be a slight change of what the other reports by the other analysts are saying. However, at the end of the day, my reports are shown with the slight modification of the reports of the other analysts. It is all because I want to keep the job. The money managers are there to go them and say that I want this analyst and I will pay this much to you, and the analysts do follow their recommendations.

One important side note is that instead of indicating the sold state of the share, these critics can show to the maximum extent like the buy to hold state. It is because the analysts of the company do not say that it is the right time to sell off your shares. However, there is an analyst report that could be better and close to genuine, and it’s hard to be list out the one.

So, when you want to get the analysis reports for the stock that you wish to consider transacting, be very careful about being diverted to the biased reports. Instead, look for the black and white figures of the company that performed in the recent past.