Zacks' Ratings of my portfolio stocks

As you may know, Zack’s rating system, which they feel is a fairly accurate short-term indicator, is based largely on analysts raising or dropping estimates or targets (as I understand it). It’s a 1-5 scale where 1 is the top group and 5 is the bottom. The largest group is 3 and smallest are 1 and 5 (like a bell-shaped curve). Of the stocks in my portfolio here are the current ratings:

1 - LGIH, Nutanix, Nvidia, Brinks

2 - Arista, Hubs, Ubiquit

3 - Alarm, Shopify, Square, Talend, Instructure

4 - None

5 - None

By the way, Amazon is a 5.

I hope some among you may find this useful.

Saul

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I used to think of Zack’s as a premium service until I started noticing Zack’s “news” generated by robots and Zack’s touting micro CAPs which made me wonder if these were paid for ads. I never paid any attention to their ratings or most any other rating service for that matter.

Just a heads up.

Denny Schlesinger

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Saul

interesting…

I briefly followed Zacks (before the paywall) and noticed they change ratings quite often. I often end up owning quite a few "5"s that are doing just fine, though I am significantly less concentrated than you and others here.

how often do you compare the ratings with your portfolio?

cheers
Nick

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I briefly followed Zacks (before the paywall) and noticed they change ratings quite often. I often end up owning quite a few "5"s that are doing just fine, though I am significantly less concentrated than you and others here. How often do you compare the ratings with your portfolio?

They send it to me every day, and as you say, there are usually 1-3 changes per day (which is why I referred to it as “short term”). They’ve done a lot of studies showing that in bulk, 1’s do lots better than 5’s over time.

Saul

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1 - LGIH, Nutanix, Nvidia, Brinks

2 - Arista, Hubs, Ubiquit

3 - Alarm, Shopify, Square, Talend, Instructure

4 - None

5 - None

By the way, Amazon is a 5.

Just to show how short term this is, here it is just 10 calendar days later:

1 - Arista, Nutanix, Nvidia, Brinks, Ubiquiti

2 - Hubs, LGIH, Square

3 - Alarm, Instructure, Shopify, Talend,

4 - None

5 - None

Amazon is still a 5, by the way.

It’s very unusual for me to have five stocks as 1’s. Usually I’m lucky to have two. And on Schwabs rating system I never have any that are rated A

Saul

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It’s very unusual for me to have five stocks as 1’s. Usually I’m lucky to have two.

So that should actually scare you, right? Maybe sell out of all those 1’s and 2’s… :wink: