14th Jan 2022 14:14
(Alliance News) - The balance of 'Buy' versus 'Sell' ratings on large and mid-cap London shares is tipped more toward Buy as the new year begins than at any time in the past eight years, retail investment platform AJ Bell noted on Friday.
Drawing on data from Refinitiv and analyst consensus forecasts, AJ Bell said 57% of all analyst recommendations for FTSE 100 stocks currently are Buy, versus only 9% at Sell and 33% at Hold. The euphoria is even slightly stronger in the FTSE 350, which includes FTSE 250 mid-cap stocks. There, Buys outweigh Sells by 59% to 8%, with 32% at Hold.
This compares to the average from 2015 to 2021 of 49% Buys and 14% Sells in the FTSE 100 and 49% versus 13% in the FTSE 350.
The most popular FTSE 100 stocks among analysts are building materials firm CRH PLC, mobile operator Vodafone Group PLC, and cigarette maker British American Tobacco, all with 90% or better Buy ratings.
Least popular are asset manager abrdn PLC, property portal Rightmove PLC, and accounting software firm Sage Group PLC, with more than 30% Sell ratings.
However, AJ Bell Investment Director Russ Mould said broker ratings should be taken with a pinch of salt. "The bad news is the analysts' top picks failed to beat the FTSE 100 index in 2015, 2016, 2017, 2018, 2020 and now 2021, despite all of their diligence," he said, showing "how hard picking individual stocks can be, even if it is your full-time job".
According to the AJ Bell figures, Sage was unpopular among analysts a year ago as well. It had 40% Sell ratings at the start of 2021 but ended up providing a fairly spicy total return of more than 50% in the year that followed.
By Tom Waite; [email protected]
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Related Shares:
RightmoveSage GroupBritish American TobaccoVodafoneCRHAbrdn