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Investors looking for guidance on what shares to include in their portfolio often follow recommendations by stock analysts. These stock analysts, who are usually employed by banks or brokerage firms, cover specific public companies by examining their financial statements, appraising relevant industry trends, and interviewing their management.
Based on this research, they frequently publish reports that contain an extensive discussion of a company’s current situation, its strategy and future prospects, including an estimate of its future earnings, and they summarize their overall evaluation of the company’s stock in a specific recommendation. This recommendation can be either positive (e.g. “Buy” or “Outperform”), neutral (e.g. “Hold” or “Market Perform”) or negative (e...
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