brokers views

Thrugelmir

moneylover wrote: »

thank you Thrugemuir - so it sounds as though though brokers reports can be quite relevant - I cannot, for example, go and quiz the management board!

Analysts publish detailed papers to their clients. Explaining their given view at a point in time.

Analysts do disagree as well.

moneylover

thanks - I just bought some shares in Tesco - at least all the analysts agree its a buy!!

dunstonh

Investing is about opinion. Opinions are formed based on knowledge. The more knowledge you have, then theoretically the better informed the opinion will be. However, it is just opinion. No one has a crystal ball.

Do not make the mistake that some seem to make when they believe brokers should have crystal ball based opinions.

zildjian

moneylover wrote: »

thank you Thrugemuir - so it sounds as though though brokers reports can be quite relevant - I cannot, for example, go and quiz the management board!

I'm pretty sure nobody can do that, even the brokers? Unless the information they share with the broker, is shared to the world at large?

moneylover

yes - Thrugelmir says further up thread:
Analysts specialise in industry sectors. So can form an opinion based on far more research and data than an ordinary shareholder. Will also receive regular briefings directly from the Management/Board.

moneylover

I suppose it amazes me that brokers, specialists in their fields, with all their knowledge and ability to ask the right questions can come to totally opposing conclusions
For example on Pennon one broker has a sell and another has outperform

bigfreddiel

moneylover wrote: »

How much importance should be attached to brokers views and are there some that are considered far more worth listening too than others?
For example I have been thinking about investing in Scottish and Southern Energy for the dividend and becuase I havent any investment in this sector. However when I looked at the brokers views there were 2 holds, one reduce, a sell from Goldman Sachs and an outperform from Exance BNB Paribas. Although I am attracted by dividend I dont want a share that is not likely to grow.

Then I looked at Pennon which has a lower yield (3.67% ) but which I have read several positive articles about recently especially Investors Chronicle which did a recent article about water shares
But low and behold Goldman Sachs has a sell on that today, re-iterated from Aug. There are, however two outperforms -HSBC and JP Morgan

How can there be such differences when the dates are very close together and there have been no particular company announcements?

Ask yourself this - do you think Warren Buffett consults brokers and their views?

dunstonh

Ask yourself this - do you think Warren Buffett consults brokers and their views?

The answer would be yes. He would have people at a suitable level giving him information and feedback. He will also be paying them a whole lot more than a retail level broker.

oldvicar

zildjian wrote: »

You have to beleive in the underlying company yourself, not what the broker says.

moneylover wrote: »

thanks - I just bought some shares in Tesco - at least all the analysts agree its a buy!!

With the retailers, more than any other sector, I think is useful to do your own basic consumer research and visit a few of their stores as well as those of their competitors. I believe you can really get a feel of whether or not they are doing well or geting better/worse just by visiting the stores long before it shows up in the financial results. Look at the reports as well of course.

moneylover

bigfreddiel wrote: »

Ask yourself this - do you think Warren Buffett consults brokers and their views?

why would I want to ask myself this question? Warren Buffet is in a different league to me and my paltry little investments. He has his day job and I have mine. Mine isnt investments.