Wells Fargo investment coverage

The comical nature of Wells Fargo investment coverage is something I’ve come to enjoy. Wells is exceptional in their concepts of both insurance brokerage (AJ Gallagher, AON, Marsh, Brown, BRP, Trion, Willis, Goosehead, etc) and railroads (CSX, Norfolk, UNP, etc) and those reading their reports can count on solid analysis.

But…but-but-but-but Wells is so damn typical of the investment industry in that they just follow the stocks up in price and continually place higher valuations on them. It works until it doesn’t.

Now for the rest of the story:

Wells, once again, will stop coverage of these stocks!

And they’ll do the same thing on East West Bancorp, a fabulously run Asian-American bank based in California. They put a price on the bank that promotes endless chasing upwards-to-the-right on the charts.

Then it all blows up!

Life…people…is great if you can stand it.

In the meanwhile people are still chasing SAAS and cyrpto…not one believer has yet turned the corner!

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In the meanwhile people are still chasing SAAS and cyrpto…not one believer has yet turned the corner!

Those who are chasing here are living with Fear of missing out. They missed previous run. Folks like me who went early in the SaaS cycle and not got out completely have turned the corner and finding reason to sell at every turn.

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You shouldn’t confuse analysts’ price targets with their or your estimate of intrinsic value.

PT is their prediction of the price in the next few months and upto a year. They use various metrics and guesses based on earnings/sales beating consensus, average recent multiples etc. So no wonder every time their PT is breached, they raise/lower it.

Most paying consumers of their research want stock tips on what to buy to make a quick buck.

I feel many analysts, esp. at Morningstar have deep insights about the business. I just read their reports and ignore the share price predictions.

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