Overall, the primary concern for an investment is capital preservation. Second is growth or income depending on the goals of the investor. The term "Market OutPerform" is not a buy signal. It does not imply the analyst has said "this stock is going up." It does imply that the analyst feels that if the market decreases by 10% this stock will decrease less than that.
i cant stand all this anti-analyst hype. Its like a bubble of hatred for analysts. Lets fade that bubble once and for all. Lets look at some good things that analysts do: a. they get 10s of thousands of people or more enthusiastic about the stocks they are pumping. Can we, as traders, really have a problem with an increase in liquidity being contributed by the "dumb money"? b. when i read an analyst report I look for a simple summary of all the recent problems/events which might have contributed to the fall/rise of the stock over the past year. Its hard to get this from news releases but 2-3 analyst reports should altogether provide a good summary. c. easier description of the balance sheet and cash flow statement than what i would find in the 10Q or 10K. d. so what if they did illegal stuff in 2000? Its unlikely that they would be doing anything illegal now. If anything, their worst crime now is that they are not thorough. I have no problem with a lack of thoroughness since they are transmitting that disease to my competitors, the investors buying on their recs. e. people complain about analysts when they are long a stock that gets downgraded for stupid reasons. Two comments: i. are you sure its for the wrong reason? ii. if its cheaper, buy more, make more money
Great! Now I'm not sure whether to feel guilty for implying analysts are unethical leeches or for attempting to take the dumb money that they help leave behind on every table...