INVESTMENT RESEARCH
Making sense of an investment analyst's report, like deciphering a diplomatic statement, means reading between the lines. BulldogResearch.com minimizes the guesswork by rating analysts' accuracy.
Launched earlier this year by stockbrokers Michael Thompson and Brent Johnstone, BulldogResearch.com ignores the hype-ridden prose and focuses on the quantitative data in reports from I/B/E/S, a major conduit for research generated by investment banks. Enter a ticker symbol, and the site returns average buy/sell/hold ratings, earnings estimates, and 12-month price targets, plus the names of analysts who track the stock. Click on a name, and Bulldog ranks the accuracy of the analyst's earnings estimates for all the stocks he or she covers.
Even better, the site ranks the aggregate return on stocks the analyst has awarded a buy rating. Search an industry - say, semiconductors - and you'll see which analysts tend to pick the winners. Once you've synchronized your marketwatch, you can download their reports, which cost anywhere from nothing to $50 each.
Unfortunately, you won't find every report by every analyst. Bulldog screens out all but the three most accurate analysts covering a given stock. "We're letting analysts shine who haven't had the chance to," Johnstone says.
Sure, some analysts make excellent forecasts, but few ever disparage a stock, even when it's obviously a dog. Take drkoop.com. The health portal has come close to bankruptcy, and the stock has fallen as much as 97 percent off its peak, yet none of the eight analysts that Bloomberg lists as covering KOOP has rated it a sell, and five have rated it a hold. Bottom line: Analysts don't make a living by helping investors. "Analysts get paid based on their relationships with managers at the companies they cover," says John Rekenthaler, research director at Morningstar.
Will the Web force analysts to tell it like it is? Rekenthaler doubts it. But BulldogResearch does subject investment analysis to serious, open scrutiny.
- Kourosh Karimkhani (kouroshk@yahoo.com)
BulldogResearch.com: www.bulldogresearch.com.
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