7 Tech Stocks Predictive Analysts Expect to Outperform

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 |  Includes: BIDU, CEL, CTXS, FTR, LSI-OLD, NOK, RVBD
by: Kapitall

Here we offer an interesting way to search for companies that analysts with a history of predicting performance expect to outperform.

Using analyst ratings from Reuters that are presented on a linear scale (with 1 = "Strong Buy" and 5 = "Strong Sell"), we sliced the ratings data of stocks from the tech sector into three time periods separated by a month, and identified the group of analysts that have shown predictive value, i.e. been able to accurately predict the direction of stock moves for two consecutive time periods.

We further narrowed down the list by only focusing on those stocks that have seen bullish trends in analyst opinion. In other words, predictive analysts, with a proven (short-term) track record of predicting their stock's direction, think these stocks are due for a rebound. The screen produced 7 stocks, listed below.

Although past performance is no guarantee of future results, the recent accuracy of these analyst ratings suggests their opinions may be a helpful starting-off point for your own analysis.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

click on image to enlarge

Do you think these stocks are about to rebound? Use this list as a starting-off point for your own analysis.

List sorted by market cap:

1. Baidu, Inc. (NASDAQ:BIDU): Internet Information Providers Industry. Market cap of $47.76 billion. Mean average rating changed from 1.85 to 1.81 between 05/18/11 and 06/17/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 23.21%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 1.81 to 1.68 (bullish change). Over the following month, the stock generated an alpha of 1.06% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 1.68 to 1.65 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock has gained 62.17% over the last year.

2. Nokia Corporation (NYSE:NOK): Communication Equipment Industry. Market cap of $23.26 billion. Mean average rating changed from 2.97 to 3.06 between 05/18/11 and 06/17/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -12.64%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 3.06 to 3.03 (bullish change). Over the following month, the stock generated an alpha of 20.99% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 3.03 to 3 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock has had a couple of great days, gaining 17.12% over the last week.

3. Citrix Systems, Inc. (NASDAQ:CTXS): Business Software & Services Industry. Market cap of $11.23 billion. Mean average rating changed from 2.41 to 2.42 between 05/18/11 and 06/17/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -1.33%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 2.42 to 2.44 (bearish change). Over the following month, the stock generated an alpha of -12.01% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.44 to 2.38 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock has performed poorly over the last month, losing 20.64%.

4. Frontier Communications Corporation (NYSE:FTR): Telecom Services Industry. Market cap of $7.09 billion. Mean average rating changed from 2.45 to 2.5 between 05/18/11 and 06/17/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -6.35%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 2.5 to 2.45 (bullish change). Over the following month, the stock generated an alpha of 2.56% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.45 to 2.41 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock is a short squeeze candidate, with a short float at 9.38% (equivalent to 7.16 days of average volume). The stock has gained 2.01% over the last year.

5. LSI Corporation (NASDAQ:LSI-OLD): Semiconductor Industry. Market cap of $4.29 billion. Mean average rating changed from 2.3 to 2.36 between 05/18/11 and 06/17/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -5.79%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 2.36 to 2.33 (bullish change). Over the following month, the stock generated an alpha of 17.21% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.33 to 2.21 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock has had a couple of great days, gaining 6.78% over the last week.

6. Riverbed Technology, Inc. (NASDAQ:RVBD): Networking & Communication Devices Industry. Market cap of $3.91 billion. Mean average rating changed from 2.03 to 2 between 05/18/11 and 06/17/11 (bullish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of 18.75%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 2 to 2.06 (bearish change). Over the following month, the stock generated an alpha of -26.42% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 2.06 to 2.03 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock has performed poorly over the last month, losing 35.05%.

7. Cellcom Israel Ltd. (NYSE:CEL): Wireless Communications Industry. Market cap of $2.18 billion. Mean average rating changed from 2.78 to 3.25 between 05/18/11 and 06/17/11 (bearish change). Analysts correctly predicted the direction of the stock over the next month, with the stock generating an alpha of -12.5%.

Analysts also got it right between 06/17/11 and 07/17/11, with the mean rating changing from 3.25 to 3.5 (bearish change). Over the following month, the stock generated an alpha of -6.89% relative to the S&P 500 index, as predicted by the analysts.

This same group of analysts now expect the stock to outperform in the future, with the mean rating changing from 3.5 to 3.29 between 07/17/11 and 08/16/11 (i.e. bullish change). The stock has performed poorly over the last month, losing 15.52%.

*Analyst ratings sourced from Reuters, price data sourced from Yahoo Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.