Analyst rating and price target changes are one of the most common catalysts in the stock market. Wall Street analysts typically have years of experience in the market and access to industry insiders, cutting edge technology and a tremendous amount of resources that are helpful in forecasting the market.
These analysts are far from perfect in picking stock winners and losers, and they take a lots of heat in the media for their mistakes. But in general, analyst commentary is a useful resource for investors.
Power Of Diversification
Financial advisors encourage investors to diversify their portfolios to help mitigate the risk that of any individual investment. Traders should think the same way about analyst opinions as well. Relying too heavily on one analyst can be dangerous, but the consensus analyst opinion on a stock can give a much more accurate snapshot of the outlook for a stock.
Analyst Sell ratings can be particularly useful to traders given they are extremely rare. In general, more than 90% of all analyst ratings are Buys or Holds, while under 10% are Sells.
Here’s a look at the 16 S&P 500 stocks with the most bearish consensus analyst ratings according to Finviz. The overall rating score is based on an average analyst rating on a scale of 1.0 (Strong Buy) to 5.0 (Strong Sell).
- Franklin Resources, Inc. (NYSE: BEN), 3.6 rating.
- Fossil Group Inc (NASDAQ: FOSL), 3.5 rating.
- J M Smucker Co (NYSE: SJM), 3.5 rating.
- Macy's Inc (NYSE: M), 3.4 rating.
- Waters Corporation (NYSE: WAT), 3.4 rating.
- Campbell Soup Company (NYSE: CPB), 3.4 rating.
- Kraft Heinz Co (NASDAQ: KHC), 3.3 rating.
- The Western Union Company (NYSE: WU), 3.3 rating.
- Mettler-Toledo International Inc. (NYSE: MTD), 3.3 rating.
- Southern Co (NYSE: SO), 3.3 rating.
- Southwestern Energy Company (NYSE: SWN), 3.2 rating.
- MarketAxess Holdings Inc. (NASDAQ: MKTX), 3.2 rating.
- Hormel Foods Corp (NYSE: HRL), 3.2 rating.
- Garmin Ltd. (NASDAQ: GRMN), 3.2 rating.
- Consolidated Edison, Inc. (NYSE: ED), 3.2 rating.
- Expeditors International of Washington (NASDAQ: EXPD), 3.2 rating.
Investors who want some insight into an analyst’s track record can check his or her profile on TipRanks. However, an analyst’s track record may be a bit deceiving if he or she covers a market sector that has performed particularly well or poorly in recent years.