Stock market traders can take advantage of special situations to take advantage of sentiment and momentum and make quick profits, if they are fast enough or lucky. But in the long run, investors have benefited from the participation of companies that increase sales, profits and cash flow. And the resulting increases in analysts ’ratings may help raise stock prices.
Below is a list of stocks among the S&P 500 SPX,
which have had the biggest increases in “buying” or equivalent ratings this year among analysts surveyed by FactSet. An update can mean that a stock has fallen enough that an analyst believes it has become a compelling value. Or it may mean that something has changed for the better in the company’s business or industry. Or it could be a combination of these and other factors.
It makes sense to focus on the positive side of the sorting action. Analysts who work for brokerage firms (those who offer recommendations to investing clients) are separated from business groups by companies that generate commissions by providing various services to some of the same firms that analysts cover. But there is still a much greater tendency for these so-called sales analysts to assign “buy” ratings or “overweight” equivalents than “sell” ratings or “low weight” equivalents.
Among the S&P 500, 270 companies have majority “buy” ratings or equivalent among analysts surveyed by FactSet, but only two (American Airlines Group Inc. AAL,
and Lumen Technologies Inc. LUMN,
) have majority or equivalent “sale” valuations.
An increase in the number of “purchase” ratings does not necessarily mean that all new “purchases” result from upgrades. The number of analysts covering any company often changes. An analyst can start coverage with a “buy” rating. Brokerage firms often add or remove coverage for companies or even entire industries due to staff changes or reallocation of resources.
Larger increases in “purchase” scores
The following is a list of 22 companies among the S&P 500 that now have at least three more “purchase” ratings than at the end of 2020:
The table is sorted in two ways: first by increasing the number of “buy” ratings, but then by the current percentage of “buy” ratings. You will need to scroll through the table to see all the data.
So, ConocoPhillips COP,
tops the list because it has five more “buy” ratings than on Dec. 31 and because 96% of analysts surveyed by FactSet currently rate the shares as “buy”.
The second company on the list, Chevron Corp. CLC,
it has also increased the number of “buy” ratings by five, but 68% of analysts rate stocks as “buy”.
Third on the list is Intel Corp. INTC,
also with five additional “buy” ratings, but with only 38% of analysts with a positive stock rating.
Higher “buy” percentage
The following is a list of 21 S&P 500 companies with the highest percentage of “buy” ratings among analysts surveyed by FactSet:
The lower two, Jacobs Engineering Group Inc. J,
and Swan Corp. CI,
they are tied at 88%.
The first two companies, Assurant Inc. AIZ,
and Teledyne Technologies Inc. TDY,
it hasn’t gotten a “buy” rating since the end of 2020, however, Teledyne has a lower overall rating, so it now ranks 100% according to FactSet data.
There are six companies involved in the production or distribution of oil in the first list and four in the second, which show the growing confidence of analysts in the recovery of the price of oil.
Amazon.com Inc. AMZN,
is fourth on the second list, with 96% “buy” ratings. The founder of Internet sales pioneer Jeff Bezos announced on February 2 that he would step down as CEO during the third quarter, while remaining executive chairman. Here’s a look at Amazon’s stock performance since it went public in May 1997.