It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. It is displayed in whole numbers - 1 to 5. The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. In spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.īroker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.ĪBR Should Not Be Confused With Zacks Rank Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. It would therefore be best to use this information to validate your own analysis or a tool that has proven to be highly effective at predicting stock price movements. This means that the interests of these institutions are not always aligned with those of retail investors, giving little insight into the direction of a stock's future price movement. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations. According to several studies, brokerage recommendations have little to no success guiding investors to choose stocks with the most potential for price appreciation.Īre you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. The ABR suggests buying Plug Power, but making an investment decision solely on the basis of this information might not be a good idea. Strong Buy and Buy respectively account for 63.6% and 4.6% of all recommendations.Ĭheck price target & stock forecast for Plug Power here> Of the 22 recommendations that derive the current ABR, 14 are Strong Buy and one is Buy. An ABR of 1.68 approximates between Strong Buy and Buy. Plug Power may be a promising green energy stock to own in the long run but for now, investors may be better off waiting until the company’s financials improve as there’s still significant risk with this stock.Plug Power currently has an average brokerage recommendation (ABR) of 1.68, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 22 brokerage firms. However, those price targets have been coming down and investors should be careful not to rely too heavily on them as more downgrades are likely coming. But the bigger issue is that its losses continue to mount as Plug Power’s operating loss of $274 million was 72% higher than the $160 million loss it reported in the prior-year period.Īccording to Wall Street analysts, the stock has an upside of more than 180% with the consensus price target at nearly $10. Last quarter, it posted revenue of $199 million, which was up from $189 million in the same period last year. In the meantime, the company’s results simply haven’t been that strong. While Plug Power has created a commercially viable market for hydrogen fuel cell technology, it still has an uncertain future ahead. That doesn’t guarantee a turnaround for the stock, but it can indicate that there has been a lot of bearishness in the markets.īut there’s good reason for that. When a stock has an RSI of less than 30, it is considered oversold. The stock is now also oversold, finishing last week with a Relative Strength Index (RSI) of just under 29. The company’s lack of profitability and overall high risk has made investors move away from the volatile green hydrogen stock. (NASDAQ:PLUG), a once-promising growth stock, has been struggling badly this year, with its valuation collapsing an incredible 72% thus far in 2023.
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