Köprekommendationers träffsäkerhet på aktiepriset.

Abstract

This study examines the accuracy of buy recommendations in comparison to the actual outcome of the stock price. There are three main areas of interest in the study: 1) A comparison of the accuracy of buy recommendations between analysts and journalists. 2) Conduct an ongoing critical discussion about the credibility of buy recommendations, in order to convey existing problems with analysts who may have incentives to publish unreasonably high target prices. 3) Analyze how the stock market climate affects the accuracy of buy recommendations. The database Mediearkivet (provided by the university) is used to collect information regarding buy recommendations on stocks listed on the Swedish stock index OMXSMCPI. The return of these recommendations is then compared to the return of the index for the same time period. Furthermore, target prices given in the buy recommendations are analyzed. Lastly, buy recommendations are divided into periods that represent positive and negative stock market climate. The study finds that buy recommendations from both analysts and journalists yields a higher return than index for all time periods. Furthermore, both analysts and journalists tend to overestimate the stock prices by providing unreasonable high target prices. Lastly we can conclude that the stock market climate has no significant impact on the accuracy of buy recommendations.