TECH - Wall Street Analysts See Blue Bird as a Buy: Should You Invest? | Benzinga
When deciding whether to buy, sell, or hold a stock, investors often rely on analyst recommendations. Media reports about rating changes by these brokerage-firm-employed (or sell-side) analysts often influence a stock's price, but are they really important?
Before we discuss the reliability of brokerage recommendations and how to use them to your advantage, let's see what these Wall Street heavyweights think about Blue Bird (NASDAQ: BLBD).
Blue Bird currently has an average brokerage recommendation of 1.14, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by seven brokerage firms. An ABR of 1.14 approximates between Strong Buy and Buy.
Of the seven recommendations that derive the current ABR, six are Strong Buy and one is Buy. Strong Buy and Buy respectively account for 85.7% and 14.3% of all recommendations.
Brokerage Recommendation Trends for BLBD
The ABR suggests buying Blue Bird, but making an investment decision solely on the basis of this information might not be a good idea. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.
Do you wonder why? As a result of the vested interest of brokerage firms in a stock ...