HomeMost PopularTech Stocks Considering Perion Network...

Considering Perion Network (PERI) as a Potential Investment Considering Perion Network (PERI) as a Potential Investment

Actionable Trade Ideas

always free

Investors often turn to Wall Street analysts for advice on stock decisions. But before we delve into the reliability of brokerage recommendations, letโ€™s see what the heavyweights of Wall Street have to say about Perion Network (PERI).

Perion Network currently boasts an average brokerage recommendation (ABR) of 1.83, positioning it between a Strong Buy and a Buy, as per calculations involving actual recommendations provided by six brokerage firms. Of the six recommendations shaping the ABR, three indicate a Strong Buy and one denotes a Buy. These proportions of Strong Buy and Buy hold the potential to impact investment decisions.

Brokerage Recommendations Perspective for PERI

Broker Rating Breakdown Chart for PERI

Interested in the price target & stock forecast for Perion Network? Check it out here.>>>

The ABR may lean towards a recommendation to buy Perion Network; however, relying solely on this information for investment decisions may not be prudent. Numerous studies have indicated the limited success rate of brokerage recommendations in steering investors towards stocks with the highest potential for price increase. This begs the question โ€“ why?

Our research indicates the presence of a strong positive bias among analysts employed by brokerage firms when rating stocks they cover, often attributed to their vested interest in those stocks. For every โ€œStrong Sellโ€ recommendation, itโ€™s not uncommon for brokerage firms to issue five โ€œStrong Buyโ€ recommendations, revealing a significant misalignment between their interests and those of retail investors.

Therefore, the best use of brokerage recommendations may lie in corroborating your own research or utilizing an indicator proven to be highly effective in predicting stock price movements.

Our proprietary stock rating tool, Zacks Rank, stands as one such indicator. With an externally audited track record, Zacks Rank categorizes stocks from #1 (Strong Buy) to #5 (Strong Sell) and serves as a reliable gauge of a stockโ€™s price performance in the near future. Thus, validating the ABR through the Zacks Rank could facilitate informed investment decisions.

ABR and Zacks Rank: Distinct Yet Interrelated

Itโ€™s essential to recognize that while both the ABR and Zacks Rank adopt a 1-5 range, they are fundamentally disparate measures. The ABR hinges solely on brokerage recommendations and is customarily presented with decimals (e.g., 1.28). In contrast, the Zacks Rank operates as a quantitative model, offering investors the opportunity to capitalize on earnings estimate revisions and is exhibited in whole numbers from 1 to 5.

Analysts employed by brokerage firms have historically displayed a consistently optimistic bias in their recommendations, largely due to their employersโ€™ vested interests. In contrast, the Zacks Rank is steered by earnings estimate revisions, and empirical research suggests a strong correlation between short-term stock price movements and trends in earnings estimate revisions.

Another notable difference between the ABR and Zacks Rank is their timeliness. While the ABR may not always be up-to-date, the Zacks Rank swiftly reflects brokerage analystsโ€™ revisions of earnings estimates to accommodate a companyโ€™s evolving business trends, making it a timely indicator of future price movements.

Is PERI a Favorable Investment?

Observing the earnings estimate revisions for Perion Network, the Zacks Consensus Estimate for the current year has escalated by 4.7% in the past month, reaching $3.34.

Analystsโ€™ escalating optimism about the companyโ€™s earnings prospects, signified by a compelling consensus among them in revising EPS estimates upward, serves as a credible impetus for the stock to potentially surge in the near term.

Given the magnitude of the recent consensus estimate alteration, in conjunction with three additional factors correlated with earnings estimates, Perion Network proudly holds a Zacks Rank #1 (Strong Buy). Curious to explore other Zacks Rank #1 (Strong Buy) stocks? Click here to access the complete list.

As such, the Buy-equivalent ABR for Perion Network may serve as a valuable compass for investors.

Zacks Names โ€œSingle Best Pick to Doubleโ€

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

Itโ€™s a little-known chemical company thatโ€™s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.

This company could rival or surpass other recent Zacksโ€™ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.

Free: See Our Top Stock and 4 Runners Up >>

Seeking the latest recommendations from Zacks Investment Research? Acquire the 7 Best Stocks for the Next 30 Days today. Click here to access the free report

Obtain a Free Stock Analysis Report on Perion Network Ltd (PERI)

To read this article on Zacks.com, click here.

Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Swing Trading Ideas and Market Commentary

Need some new swing ideas? Get free weekly swing ideas and market commentary from Jonathan Bernstein here: Swing Trading.

Explore More

Weekly In-Depth Market Analysis and Actionable Trade Ideas

Get institutional-level analysis and trade ideas to take your trading to the next level, sign up for free and become apart of the community.