Analyst Targets for Many Financial Stocks Now Well Above Trading Price

Hickey and Walters (Bespoke) submit: The recent drop in prices of many financial stocks have left consensus analyst price targets well above current market levels. LEH, MER and BSC currently have price targets that are more than 50% above their current prices, while MS and GS aren't far behind.

Looking at the 4-week change in EPS estimates for the current quarter, we also see that while investors and the market are lowering their expectations for the group, analysts have been slow to act. Are these analysts expecting a quick recovery or are downgrades soon to come?

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Comments

[Graig Stettner:]

Analyst price targets are nonsense and are for rubes.

2007 Aug 06 09:31 AM

[Chris P:]

If you are talking about making decisions based only on analyst targets, I agree, but to completely discount that information is also, as you say, for rubes.

2007 Aug 06 10:34 AM

[Anonymous 2:]

Perhaps a few more columns of comparative data such as Price to book, Price to "enterprise value", etc would help differentiate various current "valuations"

RF

2007 Aug 06 11:00 AM