HomeMost PopularTech Stocks Is Stellantis (STLA) the Golden Goose of Investments or Just...

Is Stellantis (STLA) the Golden Goose of Investments or Just Another Wall Street Wild Goose Chase?

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Wall Street analysts often hold the keys to the kingdom for investors. Their ratings can make or break a stock. But should you trust them? Before we delve into the reliability of these recommendations and how to make the most of them, letโ€™s hear what the bigwigs on Wall Street have to say about Stellantis (STLA).

Stellantis currently boasts an Average Brokerage Recommendation (ABR) of 1.63, slotting in between a Strong Buy and a Buy, based on 12 brokerage firmsโ€™ recommendations (including Buy, Hold, Sell) โ€“ a number highly regarded across the board. Of these 12, a whopping 66.7% scream Strong Buy while another 16.7% sweetly whisper Buy.

Brokerage Recommendation Trends for STLA

Broker Rating Breakdown Chart for STLA

Wondering what the crystal ball foretells for Stellantis >>>

While the ABR promotes buying Stellantis, wisdom dictates not basing your investing decisions solely on this. Studies have revealed that brokerage recommendations have little to no influence on stock price surges.

But why, you may ask? The analystsโ€™ strong positive bias toward stocks they cover, swayed by their firmsโ€™ vested interests, causes an excess of โ€œStrong Buyโ€ recommendations for every โ€œStrong Sellโ€. Itโ€™s a classic case of the fox in the henhouse, leaving investors scratching their heads rather than lining their pockets.

So, whatโ€™s a savvy investor to do? Look no further than Zacks Rank, the gold standard of stock ratings. It elegantly categorizes stocks from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), offering a handy guide for any market sojourner.

Zacks Rank vs. ABR: Spot the Difference

Both Zacks Rank and ABR wield a 1-5 scale, but thatโ€™s where the similarity ends.

ABR relies solely on brokerage recommendations, usually dripping with decimals (e.g. 1.28). In contrast, Zacks Rank does a victory lap based on earnings estimate revisions, giving you the lowdown in whole numbers from 1 to 5.

Itโ€™s a tale as old as time โ€“ brokerage analysts serve up more fairy tales than Cold Hard Truths. On the flip side, the Zacks Rank dances to the beat of earnings estimate revisions and has the data to prove its charm with stock price movements.

But wait โ€“ thereโ€™s more! The Zacks Rank delicately portions out its ranks across all stocks with analystsโ€™ earnings estimates, maintaining equilibrium no matter the marketโ€™s caprices. And guess what? Unlike the ABR, itโ€™s always on the ball with the latest data, leading the way to predicting future stock prices.

So, Should You Board the Stellantis Train?

Take a gander at Stellantisโ€™ earnings estimate revisions and behold โ€“ the Zacks Consensus Estimate for the current year has waltzed up 1% in the past month to $6.23. Analysts are high-fiving each other over the companyโ€™s earnings prospects, marking a unanimous uptick in revising EPS estimates upward. Itโ€™s the sort of horn of plenty that could propel the stock skyward.

The recent consensus estimate shift and three other telltale signs have bestowed a Zacks Rank #1 (Strong Buy) upon Stellantis. Feel like joining the winning team? Check out todayโ€™s Zacks Rank #1 (Strong Buy) stocks here»»»»

So, in a nutshell, the Buy-equivalent ABR for Stellantis could be the guiding star leading to the investment pot of gold.

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

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