Investment Analysts and their evaluation jokes

The Analysts downgrade the stock when it is going down and upgrade the stock when it is going up!! There are a billion opportunities and one has a fair chance of getting a hit – or so it seems going by how the anal-ysts have tracked Apple. Today’s Needham analyst’s downgrade of Apple is no better, downgrading the stock to 595 due to increased competition. Just as recently as February 2013 he had a price target of $700+ and competition hasn’t gotten any stiffer since them – the plethora of Android devices are still pouring in; the deceleration Apple’s innovation was as evident then as it is now. The analyst industry is one area where there are no regulations and hence one can act with impunity. At most, he or she takes on a different job, but the naive investor who follows the analysts are the ones who get burnt. Take the example of Jim Cramer. He is on TV every week day and he goes on ranting about which stock is a good bet and which isn’t and I recall an analysis of his recommendations and just be the sheer number of recommendations he doesn’t stand a chance of getting a positive lean begging an investor to follow him consistently. And then there is impunity – no one can question him or hold him accountable if he is wrong. It seems the more intelligent analysts don’t come on TV and make noise about their recommendations, but stay back and manage their clients’ portfolios in the shadows trying to do whatever justice they can.

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