Broker Recommendations often don't make sense!

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After excellent results for Persimom today, two brokers issue broker notes:

Liberum Capital 'HOLD' Target 1486p ?? (current share price 1880p)

Why on earth would you advise anyone to hold if you thought the price was headed for a 20% fall?

Peel Hunt target 2200p

http://www.nandp.co.uk/sharedealing/company/?companyCode=PSN

I have seen this sort of nonsense quite often e.g. a Sell rec. but with a price target higher than the current share price??

Comments

  • bigadaj
    bigadaj Posts: 11,531 Forumite
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    They'll have just got the new graduates in.
  • EdGasket
    EdGasket Posts: 3,503 Forumite
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    Same link as another broker wades in:

    Canaccord Genuity - 'Buy' (with the price at 1870p) target 1540p

    Think I could do better!
  • hoc
    hoc Posts: 565 Forumite
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    They don't know what they're doing.

    Cannaccord had the same Hold with 2170 target until this month. On July 5 they were still advising the same, after Brexit vote when it had crashed to 1300. It has been over 1540 for over a month and won't go back to that level anytime soon.

    Liberum is a small firm, hasn't been in business 10 years. Seen some Mickey Mouse forecasts from them before.
  • Kendall80
    Kendall80 Posts: 965 Forumite
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    Some may well give contrary advice to cover their own short positions.
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    Motley fool on Monday morning, big article saying how many brokers were saying house builders a very poor investment, get out, MF agreed with them.

    Today, article on HL with other brokers now saying that house builders looking like a Best Buy for rest of this year,and most builders are up around 7% this week, eg past two days.

    I followed a particular high tech company over 15+ years, whenever a broker recommendation came out it was inevitably followed by a significant immediate rise or dip in price (depending what the broker said) and then over next few weeks the opposite to whatever the broker had said would happen. But no one seems to remember the history of these bozos.
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