We are in the middle of earnings season and a company on your watchlist releases results. You are not sure if the numbers are good, but then later your broker tells you that the numbers are better than estimates/consensus. Have you ever wondered where the quoted number for "consensus" comes from? Consensus is the aggregate estimate from analysts and the information is not a secret. We are levelling the playing field, helping the retail investor gain access to the same information as the professionals by including the consensus ratings on Sharenet QuickShare. And the best part: it is completely free.
You can browse the shares you would like to view at your own leisure. We have gone one step further and identified the shares that are currently the most (and least) loved by analysts right now.
The below charts contain the average ratings and 12-month target prices for the JSE Top40 Index obtained from a large pool of analysts around the world. The data was captured weekly for the past month and when summarised, the winners and losers were identified.
The first table shows the change in the average target prices over the past month. The majority of the top-rated shares are those with most of their earnings generated offshore. With the weaker rand this could be expected. Sasol features as the second highest upgrade but we would probably see a slightly different picture when the results that were released on 20 August are taken into consideration.
The most consistent rated shares over the past month can be seen in the second table. Capitec maintained its average ’Buy’ rating and Spar its average ’Sell’ rating. On our QuickShare page, it shows that CPI is widely covered which means that research has led a number of analysts to have a positive view of this company.
A summary view of the average sentiment for the JSE listed shares shows that the market is moving into Hold+ territory (Hold with positive view). An increase in ’Hold’ ratings can also be observed on the third graph as the proportion ’Buy’ and ’Hold’- ratings decrease in weeks three and four.
JSE Top40 average share ratings
Data aggregated from various sources
The average target prices can be obtained from the RTA trading tool which now includes a section on analyst consensus for individual stock as well as some of the JSE indexes. If you are interested in an upgrade for your trading experience, contact us today to get the latest addition to your trading toolbox.
Joani van Wyk
Joani van Wyk joined the asset management team in January 2017, responsible for quantitative research of equities across all industries. Joani completed her degree in Mathematical Science in 2015, as well as an Honours degree in Financial Risk Management in 2016, both at the University of Stellenbosch. She is currently a CFA candidate.