Marketwatch stock upgrades

Guide to analyst recommendations

The following is a guide to the stock-research ratings systems used by the brokerage firms covered by MarketWatch.

Because ratings terms vary from firm to firm, the guide is designed to help investors understand the meaning behind each rating (where available) and to allow them to make comparisons between each firm's recommendation. Some brokerages turned down MarketWatch's requests for their rating descriptions.

For analysts' current ratings changes and other research click here.

A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | R | S | T | U | W | Y

A.G. Edwards

• Buy
  A total return is anticipated in excess of the market's long-term historic annual rate (approximately 10%). Total return expectations should be higher for stocks that possess greater risk.
• Hold
  Hold the shares with neither a materially positive total return nor a materially negative total return anticipated.
• Sell
  Stock should be sold as materially negative total return is anticipated.

Advanced Equities

Has both short-term and long-term rating for each stock

• Strong Buy
• Buy
• Accumulate
• Neutral

Advest

• Strong Buy
• Buy
• Market Perform
• Market Underperform

BB&T Capital Markets

• Strong Buy
  Estimated total return potential greater than or equal to 25 percent.
• Long-Term Buy
  Estimated total return potential greater than or equal to 10 percent and less than 25 percent.
• Hold
  Estimated total return potential greater than or equal to 0 percent and less than 10 percent.
• Underweight
  Estimated total return potential less than 0 percent.

BMO Nesbitt Burns

• Top Pick
• Buy
• Outperform
• Market Perform
• Underperform

Banc of America Securities

• Strong Buy
• Buy
• Market Performer
• Underperformer

Barrington Research

• Strong Buy
  Expected to outperform the market over the next six months. Potential exists for near-term catalyst
• Accumulate
  Expected to outperform the market over the next 12 months. Suggest establishing partial positions at current levels, adding on price weakness or improved fundamentals.
• Market Perform
  Expected to underperform the market over next six months. Fully valued or overvalued at current levels.
• Sell
  Expected to significantly underperform the market. Deteriorating fundamentals

Bear Stearns

• Outperform
  Stock is projected to outperform the analyst's coverage universe over next 12 months.
• Peer Perform
  Stock is projected to perform approximately in line with analyst's industry coverage universe over next 12 months.
• Underperform
  Stock is projected to underperform the analyst's industry coverage universe over the next 12-months.

Sectors are also rated either Market Overweight, Market Weight and Market Underweight.

Belmont Harbor Capital

• Outperformer -Intermediate-term (up to 6 months)
  Common stock expected to provide total return that is 5 or more percentage points greater than S&P 500; Long-term (6-18 months) - Common stock expected to provide total return that is at least 10 percentage points greater than S&P 500
• Market Performer -Intermediate-term
  Common stock expected to provide total return within 4 percentage points (plus/minus) than S&P 500; Long-term - Common stock is expected to provide total return that is within 9 percentage points (plus/minus) than S&P 500
• Underperformer -Intermediate-term
  Common stock is expected to provide total return that is 5 or more percentage points less than S&P 500; Long-term - Common stock is expected to provide total return that is at least 10 percentage points less than S&P 500

Blaylock & Partners

• Buy
  Expects stock to outperform the generally recognized market indexes by 20 percent
• Hold
  Expects stock to track generally recognized market indexes
• Sell
  Expects stock to underperform generally recognized market indexes by 20 percent
• Not Rated
  An investment banking client that has generated material fees over the past 12 months or who may pay fees in next 3 months

Brean Murray & Co.

• Strong Buy
  Expected to outperform market over next 6-12 months, minimal risk to fundamentals or valuation. Good long-term investment.
• Buy
  Expected to outperform the market over next 12 months; moderate risk to fundamentals or valuation.
• Hold
  Expected to perform in line with the market over next 6-12 months, moderate to substantial risk to fundamentals or valuation.
• Sell
  Expected to underperform the market over next 6-12 months, high risk to fundamentals or valuation.

Buckingham Research

• Strong Buy
  Expects stock to appreciate 25% or more within next 6-12 months. There is good visibility and nearer-term earnings or events catalysts are expected.
• Accumulate
  Expects 15-25% appreciation over next 6-12 months and stock is attractively valued but near-term catalysts are lacking.
• Neutral
  Stock's current price reflects intermediate-term price objectives and expects stock to perform in line with the market.
• Swap
  There appears to be more risk than reward in stock at current levels. Expects stock to underperform the market over next 6-12 months.

C.E. Unterberg Towbin

• Short-Term Buy
  Over three to six months, estimated 20 percent appreciation
• Long-Term Buy
  Over 12 to 24 months, estimated 35 percent appreciation
• Short-Term Market Perform
  Performance in line with market averages anticipated over three to six months
• Long-Term Market Perform
  Performance in line with market averages anticipated over 12 to 24 months
• Short-Term Avoid
  Significant underperformance anticipated over three to six months
• Long-Term Avoid
  Significant underperformance anticipated over 12 to 24 months

C.L. King

• Strong Buy
  Projected relative performance of +20% or more in 12 months. Minimal risk to fundamentals, immediacy of story/catalysts in next 6 months.
• Accumulate
  Projected relative performance of +10% or more in 12 months. Moderate risk to fundamentals, immediacy of story/catalysts in next 6-12 months.
• Neutral
  Projected relative performance of +/-10% in 12 months. Moderate to substantial risk to fundamentals, immediacy of story/catalysts in next 6-12 months.
• Sell
  Projected relative performance of -10% or more in 12 months. High risk to fundamentals, immediacy of story/catalysts in next 6 months.

CIBC World Markets

• Sector Outperformer
  Stock expected to outperform sector during next 12-18 months.
• Sector Performer
  Stock expected to perform in line with sector during next 12-18 months.
• Sector Underperformer
  Stock expected to underperform sector during next 12-18 months.

Sectors carry weightings of overweight: Expected to outperform the broader market averages; market weight: Expected to equal performance of broader market averages; underweight: expected to underperform broader market averages.

CJS Securities

• Strong Buy
• Buy
• Accumulate
• Hold

Cohen Bros.

• Strong Buy
  Stock projected to appreciate by more than 20 percent
• Buy
  Stock projected to outperform the market
• Hold
  Stock projected to perform in line with the market
• Sell
  Stock projected to perform significantly below the market

Commerce Capital Markets

• Strong Buy
  Expected to outperform market near-term and long-term by more than 10 percent
• Market Outperform
  Expected to outperform market long-term by over 10 percent
• Market Perform
  Expected to perform in-line with market (plus or minus 5 percent)
• Market Underperform
  Expected to underperform market by more than 10 percent

Craig Hallum

• Buy
  12-month or longer price target generally is at least 20% higher than current price.
• Neutral
  12-month or longer price target generally is in a range of 19% higher to 10% lower than current price.
• Sell
  12-month or longer price target generally is at least 10% below current price.

Credit Lyonnais

• Buy
  Expected return above 20 percent over 12 months
• Add
  Expected return between 10 and 20 percent over 12 months
• Hold
  Expected return between 0 and 10 percent over 12 months
• Reduce
  Expected negative return but by less than 20 percent over 12 months
• Sell
  Expected negative return by more than 20 percent over 12 months

Credit Suisse First Boston

• Outperform
  Stock's total return is expected to exceed the industry average by at least 10-15 percent (or more depending on perceived risk) over next 12 months.
• Neutral
  Stock's toatal return is expected to be in line with the industry average (range of +/-10%) over next 12 months.
• Underperform
  Stock's total return is expected to underperform the industry average by 10-15 percent or more over next 12 months.

Industries are rated either overweight: Expected to outperform the relevant broad market benchmark over the next 12 months; market weight: Expected to perform in-line with the relevant broad market benchmark over next 12 months; or underweight: Expected to underperform the relevant broad market benchmark over the next 12 months.

Davenport & Co.

• Strong Buy
  Stocks are viewed as compelling short and long-term investment opportunities. Expects these shares to materially outperform the market over the next 12 months. Aggressive purchase is recommended at current levels.
• Buy
  Shares offer attractive long-term appreciation potential from current prices. Would expect shares to outperform the market over a longer-term horizon and long-term investors can buy at current prices.
• Neutral
  Shares should perform roughly in line with current market. Neither encourages purchase or sale of these securities at current prices.
• Reduce/Sell
  Shares have more downside risk than upside potential at current prices. Expects shares to underperform the market from current prices.

Deutsche Bank Securities

• Strong Buy
  Firm's best picks, backed with high degree of confidence. Expects significant outperformance against the market and the time to act to buy the stock is now.
• Buy
  Stocks expected to outperform against the market by 10% or more over next 12 months.
• Market Perform
  Relates to local index and indicates expectation stock will broadly perform in line with market over a 12-month period and that share price is likely to trade within a range of +/-10%.
• Underperform
  Expects underperformance against the local market by 10% or more over next 12 months.

Dresdner Kleinwort Benson

• Strong Buy
• Buy
• Hold
• Reduce
• Sell

Dundee Securities

Edward Jones

Emerging Growth Equities

FAC/Equities

• Strong Buy
• Buy
• Neutral
• Underperform

FTN Financial Securities

• Outperform
  15% upside in place upon initiation or upgrade.
• Neutral
  Less than 15% upside or downside in place upon initiation or upgrade/downgrade.
• Underperform
  15% downside in place upon initiation or downgrade.

Fahnestock & Co.

• Buy
  Anticipates appreciation of 10% or more within the next 12 months, and/or a total return of 10% including dividend payments, and/or the ability of the shares to perform better than the leading stock market averages or stocks within its particular industry sector.
• Neutral
  Anticipates stock will trade at or near current price and generally in line with leading market averages due to perceived absence of strong dynamics that would cause volatility either to upside or downside, and/or will perform less well than higher rated companies within its peer group.
• Sell
  Anticipates stock will depreciate 10% or more in price within the next 12 months due to fundamental weakness perceived in co. or for valuation reasons, or are expected to perform significantly worse than equities within its peer group.

Ferris Baker Watts

• Buy
  One factor must be positive or two positives if there is one negative.
• Hold
  All categories neutral, or positives and negatives balanced.
• Sell
  All four categories negative or negative fundamental developments that imply questionable intrinsic value.

Factors on which ratings are based are intrinsic value; relative value; capital flow/market sentiment; and fundamental catalyst.

First Analysis

• Overweight
  Stock expected to perform better than the broad market over next 12 months.
• Equal-weight
  Stock price expected to perform in line with broad market over next 12 months.
• Underweight
  Stock expected to perform worse than broad market over next 12 months.

Fox-Pitt Kelton

• Outperform
  Expects stock to outperform the sector over next 12 months.
• In line
  Expects stock to perform in line with its sector over next 12 months.
• Underperform
  Expects stock to underperform its sector over next 12 months.

Friedman Billings Ramsey

• Outperform
  Expects co. will outperform similar companies within its industry over next 12 months. Recommends investors buy securities at current valuation.
• Market Perform
  Expects co. will perform in line with similar companies within its industry. Recommends investors maintain current positions and add on weakness as valuation or fundamentals become more favorable.
• Underperform
  Expects co. will underperform similar companies within its industry. Recommends investors reduce their positions until valuation or fundamentals become more compelling.

Frost Securities

• Strong Buy
  25 percent-plus absolute total return or 15 percent-plus relative outperformance over next 9-12 months
• Buy
  15 percent-plus total return, 10 percent-plus relative outperformance over next 9-12 months, or stocks with strong buy potential returns but earnings visibility too limited to justify strong buy rating
• Market Perform
  Minus-10 percent to plus-10 percent relative return in-line with the market over the next 9-12 months
• Market Underperform
  Absolute return 0 percent to minus-20 percent relative underperformance over next 9-12 months

Gerard Klauer Mattison

• Buy
• Outperform
• Neutral
• Underperform

Goldman Sachs

• Recommended List
  Expected to provide price gains of at least 10 percentage points greater than the market over next 6-18 months.
• Latin America Recommended List
  Expected to provide price gains at least 10 percentage points greater than the Latin America MSCI Index over next 6-18 months.
• Trading Buy
  Expected to provide price gains of at least 20 percentage points sometime in the next 6-9 months.
• Market Outperformer
  Expected to provide price gains of at least 5-10 percentage points greater than the market over next 6-18 months.
• Market Performer
  Expected to provide price gains similar to the market over next 6-18 months.
• Market Underperformer
  Expected to provide price gains of at least 5 percentage points less than the market over next 6-18 months.

H.C. Wainwright

• Strong Buy
• Buy
• Hold
• Sell
• Monitor

Hibernia Southcoast Capital

Ratings represent time frame of within 12 months.

• Buy
  Stocks deemed to have potential to achieve minimum 15% upside to current price.
• Hold
  Stocks that are deemed to have greater amount of risk and/or less timely price appreciation potential.
• Sell
  Stocks where a negative return is expected

Investec

• Buy
  Expected 12-month absolute performance of +20% or greater from the price at the time the rating was initiated.
• Hold
  Expected 12-month absolute performance of +20% to -20% from the price at the time the rating was initiated.
• Sell
  Expected 12-month absolute performance of -20% or less from the price at the time the rating was initiated.

J. Michael-Patrick

J.P. Morgan H&Q

• Overweight
  Expects stock to outperform average total return of stocks in analyst's or analyst's team's coverage universe over next 6-12 months.
• Neutral
  Expects stock to perform in line with the average total return of stocks in analyst's o r analyst's team's coverage universe over next 6-12 months.
• Underweight
  Expects stock to underperform the average total return of stocks in the analyst's or analyst's team's coverage universe over next 6-12 months.

Janney Montgomery Scott

• Strong Buy
• Buy
• Accumulate
• Hold
• Sell

Jefferies & Co.

• Buy
  Expected to appreciate by 20% or more. Stock's total return expected to exceed the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12 months.
• Accumulate
  Expected to appreciate by 10-20%.
• Hold
  Expected to change plus or minus 10%. Stock's total return is expected to be in line with the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12 months.
• Sell
  Expected to decline by more than 10%. Stock's total return is expected to be below the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12 months.
• NR
  Investment rating and target price, if any, have been suspended temporarily.

Johnson Rice & Co.

• Buy
• Accumulate
• Hold
• Funds Source
• Sell

JMP Partners

• Strong Buy
  Expects stock price to appreciate 20 percent or more on absolute basis over next 6 months
• Market Outperform
  Expect stock price to outperform relevant market indices over next 12 months
• Market Perform
  Expect stock price to perform in -line with relevant market indices over next 12 months
• Market Underperform
  Expect stock price to underperform relevant mark indices over next 12 months
• Sell
  View stock as source of funds

Kaufman Bros.

• Buy
  Expects stock to outperform its peer group over next 12 months due to superior fundamentals, low valuation and/or positive catalysts
• Hold
  Expects stock to perform in line with peer group over next 12 months due to full valuation and/or lack of catalysts
• Sell
  Expects stock to underperform its peer group over next 12 months due to deteriorating fundamentals overvaluation and/or negative catalysts

Kempen & Co.

Ladenburg Thalmann

• Buy
  Expected total return of at least 10% greater than the market over next 12-18 months.
• Market Perform
  Expected total return at or near +/-10% of the market over the next 12-18 months.
• Sell
  Expected total return of more than -10% of the market over next 12-18 months.

Lazard Freres

Leerink Swann & Co.

• Outperform
  Expects stock to outperform its benchmark by more than 10 percentage points over next 12 months.
• Market Perform
  Expects stock to perform within a range of plus or minus 10 percentage points of its benchmark over next 12 months.
• Underperform
  Expects stock to underperform its benchmark by more than 10 percentage points over next 12 months.

Legg Mason

• Buy
  Expects stock to outperform the S&P 500 by more than 10% over next 12 months. For higher-yielding equities such as REITs and utilities, expects total return in excess of 12% over next 12 months.
• Hold
  Expects stock to perform within +/-10% of the S&P 500 over next 12-months. Also used for higher yielding securities where there is comfort with safety of the dividend but believe upside in share price is limited.
• Sell
  Expected to underperform the S&P 500 by more than 10 percent over next 12 months and believes stock could decline in value.

Risk ratings of Low, Average and High are also assigned to stocks based primarily on strength of balance sheet and predictability of earnings.

Lehman Bros.

• Overweight
  Stock is expected to outperform the weighted total return of the industry sector over a 12-month investment horizon.
• Equal-Weight
  Stock is expected to perform in line with the unweighted total return of the industry sector over a 12-month investment horizon.
• Underweight
  Stock is expected to underperform the unweighted expected total return of the industry sector over a 12-month investment horizon.
• Rating Suspended
  Rating and target price have been suspended temporarily to comply with applicable regulations and/or firm policies in certain circumstances including when Lehman Bros. is acting in an advisory capacity on a merger or strategic transaction involving the company.

Sectors are rated either positive where sector fundamentals are improving; neutral where sector fundamentals are steady, neither improving nor deteriorating; or negative where sector fundamentals are deteriorating.

Loop Capital Markets

• Industry Significant Outperform
  Company will perform in excess of 30%.
• Industry Outperform
  Company will perform by greater than 10% but below 30%.
• Industry Perform
  Company will perform within +/-10% of the benchmark.
• Industry Underperform
  Company will underperform by more than 10% but less then 30%.
• Industry Significant Underperform
  Company will underperform by more than 30%.

McAdams Wright Ragen

• Buy
  Expects stock to outperform the market.
• Hold
  Expects stock to be a market performer.
• Sell
  Expects stock to underperform the market.

Mercury Partners

• Buy
  Risk adjusted, 12-month total return estimated to be above 12%.
• Hold
  Risk adjusted, 12-month total return estimated between 5% and 12%.
• Sell
  Risk adjusted, 12-month total return estimated to be 5% or less.

Merrill Lynch

• Buy
  Expected total return of 10% or more for low and medium volatility risk securities within 12-month period from date of initial rating; 20% or more for high volatility risk securities.
• Neutral
  0-10% expected total return for low and medium volatility risk securities within 12-month period from initial date of rating; 0-20% for high volatility risk securities.
• Sell
  Negative return.

Midwest Research

Moors & Cabot

Morgan Lewins & Co.

• Buy
  Reasonable outperformance relative to the market over 12-18 months.
• Hold
  Market-type risk adjusted performance; potential source of funds.
• Sell
  Expected to underperform the market.

Morgan Stanley

• Overweight
  Stock's total return is expected to exceed the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over next 12-18 months.
• Equal-weight
  Stock's total return is expected to be in line with the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over next 12-18 months.
• Underweight
  Stock's total return is expected to be below the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over next 12-18 months.
• More Volatile
  Estimates stock has more than 25% chance of price move up or down of more than 25% in a month, based on a quantitative assessment of historical data. Or, in analyst's view, is likely to become materially more volatile over next 1-12 months compared with past 3 years. Stocks with less than one year of trading history are automatically rated as more volatile unless otherwise noted.

National Bank Financial

Needham & Co.

• Strong Buy
  A security, which at the time the rating is instituted, indicates an expectation of a total return of at least 50 percent over the next 12-18 months.
• Buy
  A security, which at the time the rating is instituted, indicates an expectation of a total return of between 20 percent and 50 percent over the next 12-18 months.
• Hold
  A security, which at the time the rating is instituted, indicates a total return of +/-20 percent over next 12-18 months.
• Sell
  A security, which at the time the rating is instituted, indicates an expectation that the price will depreciate by more than 20 percent over the next 12-18 months.

Oscar Gruss

• Buy
  Expected total annual return of greater than 20 percent
• Speculative Buy
  Expected total annual return of greater than 25 percent if anticipated contingencies materialize over next 12-18 months, with potential for high return volatility and greater than average risk for lower or negative total annual returns in this time period
• Outperform
  Expected total annual return in the range of 10 percent-20 percent
• Hold
  Stock appears to be fairly valued and may provide returns which approximate returns expected from its peer group in the equity markets
• Sell
  Stock appears overvalued or is experiencing problems that may cause it to underperform peer group

Other factors considered in ratings may include but are not limited to the company's risk profile including earnings predictability, financial position, industry position, technology and product risks, management strengths and other factors

Pacific Crest

Pacific Growth Equities

• Overweight
  Stock's total return is expected to exceed the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12-18 months.
• Equal Weight
  Stock's total return is expected to be in line with the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12-18 months.
• Under Weight
  Stock's total return is expected to be below the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12-18 months.

PMG Capital

• Strong Buy
• Buy
• Long-Term Buy
• Hold

Prudential

• Buy
  Expected to appreciate a minimum of 20 percent viewed on total return basis over 12-month time horizon.
• Hold
  All other stocks
• Sell
  Expected to depreciate a minimum of 20 percent viewed on total return basis over 12-month time horizon.

Putnam Lovell

RBC Capital Markets

• Top Pick
  A subset of outperform rated companies representing the best in the outperform category; an analyst's best ideas; expected to significantly outperform the sector over 12 months; provides very best risk-reward ratio; represents about 10 percent of each analyst's recommendations.
• Outperform
  Expected to materially outperform the sector average over 12 months.
• Sector Perform
  Returns expected to be in line with sector average over 12 months.
• Underperform
  Returns expected to be materially below the sector average over 12 months.

All recommendations also include risk qualifiers of either above average, average and speculative.

RTX Securities

• Strong Buy
  Outperform market in near-term; initiate full position now
• Buy
  Outperform market over next 12 months; begin or add to position
• Market Perform
  Perform in line with market over next 12 months; hold position
• Reduce
  Underperform market over next 12 months; lighten position
• Sell
  Underperform market in near-term; sell entire position

Ragen MacKenzie

• Strong Buy
• Buy
• Accumulate
• Market Perform

Raymond James

• Strong Buy
  Stock is expected to appreciate and produce a total return of at least 15 percent and outperform the S&P 500 over the next six months.
• Outperform
  Stock is expected to appreciate and outperform the S&P 500 over the next 12 months.
• Market Perform
  Stock is expected to perform generally in line with the S&P 500 over the next 12 months and is potentially a source of funds for more highly rated securities.
• Underperform
  Stock is expected to underperform the S&P 500 or its sector over the next 6-12 months and should be sold.

Research Capital

Robert W. Baird

• Outperform
  Expected to outperform on a total return, risk-adjusted basis the broader U.S. equity market over the next 12 months.
• Neutral
  Expected to perform in line with the broader U.S. equity market over the next 12 months.
• Underperform
  Expected to underperform on a total return, risk-adjusted basis the broader U.S. equity market over the next 12-months.

Risk ratings of Lower, Average, Higher and Speculative also apply.

Roth Capital Partners

SG Cowen

• Strong Buy
  Stock expected to outperform the market by over 25% over 12-month horizon.
• Buy
  Stock expected to outperform the market by 10-25% over 12-month horizon.
• Market Perform
  Stock expected to out/underperform the market by +/-10% over 12-month horizon.
• Underperform
  Stock Expected to underperform the market by at least 10% over 12-month horizon.

Salomon Smith Barney

• Outperform
  Stock is projected to outperform analyst's industry coverage universe over the coming 12-18 months.
• In-Line
  Stock is projected to perform approximately in line with analyst's industry coverage universe.
• Underperform
  Stock is projected to underperform analyst's industry coverage universe over the coming 12-18 months.

Industries are rated relative to the primary market index in each region as either overweight: Expected to perform better than primary market index for region in next 12-18 months; marketweight: Expected to perform about in line with the primary market index for the region in the next 12-18 months; or underweight: Expected to perform worse than the primary market index for the region in the next 12-18 months. Stocks also carry risk ratings of either low, medium high, or speculative.

Sandler O'Neill

• Buy
  Stock is materially undervalued and represents and attractive investment candidate. Stock expected to appreciate more than 10% within next 12 months.
• Maintain
  Stock is either fairly valued or modestly undervalued, is expected to appreciate between 0 and 10% within next 12 months.
• Reduce
  Stock is overvalued and could decline in value within next 12 months. Potential price decline could be of any magnitude and is quantified by analyst's price target.

Sands Brothers

Sanford Bernstein

• Outperform
  Stock will outpace the market index by more than 15 percentage points in the year ahead.
• Market Perform
  Stock will perform in line with the market index to within +/- 15 percentage points in the year ahead.
• Underperform
  Stock will trail the performance of the market index by more than 15 percentage points in the year ahead.

Seidler Cos.

• Strong Buy
  Greater than 20% return vs. market within next 6-12 months.
• Buy
  Strong long-term fundamentals, expect positive return over next 12-18 months.
• Hold
  Declining business fundamentals, limited visibility.
• Sell
  Poor fundamentals, expect significant downside to stock over next 12 months.

Sidoti & Co.

• Buy
  Suggests capital appreciation of at least 25% over the next 12 months.
• Neutral
  Stock not likely to provide similar gains over a 12- month period.

SoundView Technology Group

• Outperform
  Expect stock to outperform SoundView 100 benchmark by more than 10 percentage points over next 6-12 months
• Neutral
  Expect stock to perform within a range of +/-10 percentage points of the SoundView 100 benchmark over next 6-12 months

Spencer Clarke

Stephens Inc.

• Overweight
  Stock's total return is expected to be greater than the total return of the company's industry sector, on a risk adjusted basis, over the next 12 months.
• Equal-Weight
  Stock's total return is expected to be equivalent to the total return of the company's industry sector, on a risk-adjusted basis, over the next 12 months.
• Underweight
  Stock's total return is expected to be less than the total return of the company's industry sector, on a risk-adjusted basis, over the next 12 months.
• Volatile
  Stock's price volatility is potentially higher than that of the company's industry sector.

Recommendations are made within the broader context of an industry rating. Industry fundamentals are rated either improving, stable or deteriorating.

Sterling Research

Stifel Nicolaus

• Strong Buy
  Stock is expected to achieve a total return of 20% or more, to outperform the S&P 500 and to outperform its industry peers over the next 12-18 months.
• Buy
  Stock is expected to achieve total return of 15% or more and to outperform the S&P 500 over the next 12-18 months.
• Market Perform
  Stock is expected to perform generally in line with the S&P 500 over the next 12-18 months and is potentially a source of funds for investor clients.
• Market Underperform
  Stock is expected to lose 10% or more in total return, to underperform the S&P 500 and to underperform its industry peers over the next 12-18 months. The security should be sold if such sale is consistent with clients' needs and objectives.

SunTrust Robinson-Humphrey

• Overweight
  Stock's total return is expected to exceed the unweighted average return of the analyst's industry group over the next 12 months.
• Equal Weight
  Stock's total return is expected to be in line with unweighted average return of analyst's industry group over the next 12 months.
• Underweight
  Stock's total return is expected to be below the unweighted average return of the analyst's industry group over the next 12 months.

Stocks are also assigned a risk rank based on combination of fundamental and stock volatility factors of either Low, Moderate, High, Speculative or Venture.

Sutro & Co.

• Strong Buy
• Buy
• Accumulate
• Hold

SWS Securities

• Strong Buy
  Fundamentals of company and industry are strong and stock has an attractive valuation. Expects 20 percent or higher return over next 12 months.
• Market Outperform
  Good company but short-term price volatility expected. Expects stock performance to exceed average historical market return, but appreciate less than 20 percent over next 12 months.
• Neutral
  Stock is fairly valued. There is no compelling reason to buy or sell the stock today. Is cautious about short-term prospects for industry/company.
• Sell
  Fundamentals of industry and/or company are deteriorating. Doesn't expect company to have consistent earnings growth over next 12-24 months or business model is questionable. Expects 20 percent or more stock price depreciation.

Think Equity Partners

• Overweight
  Expected outperform the unweighted expected total return of the analyst's universe over a 12-month investment horizon.
• Equal Weight
  Expected to perform in-line with the unweighted expected total return of analyst's universe over a 12-month investment horizon.
• Underweight
  Expected to underperform the unweighted expected total return of the analyst's universe over a 12-month investment horizon.

Thomas Weisel Partners

• Strong Buy
  Among the best ideas under coverage at the firm. Stock is mispriced relative to business prospects and/or other names in the sector. Expect a near-term catalyst to drive valuation higher
• Buy
  Solid business prospects and/or attractive valuation should cause the stock to outperform the market. A near-term catalyst may exist
• Market Perform
  Solid business prospects should cause the common stock to perform in line with stocks of similar potential/risk.
• Underperform
  Stock is fundamentally overpriced. Valuation is highly likely to fall in the short-term

Tucker Anthony

• Strong Buy
• Buy
• Market Perform

UBS Warburg

• Strong Buy
  Greater than 20% excess return potential; high degree of confidence.
• Buy
  Positive excess return potential.
• Hold
  Low excess return potential; low degree of confidence.
• Reduce
  Negative excess return potential.
• Sell
  Greater than 20% negative excess return potential; high degree of confidence.

USB Piper Jaffray

• Strong Buy
  Expected to significantly outperform relevant broader market index over next 6 to 12 months. An identifiable catalyst is present to drive appreciation.
• Outperform
  Expected to outperform the relevant broader market index over next 12 to 18 months.
• Market Perform
  Expected to perform in line with relevant broader market index over next 6 to 12 months.
• Underperform
  Expected to underperform the relevant broader market index over next 6 to 12 months.

WR Hambrecht & Co.

• Buy
  Stocks recommended for active buying, are expected in absolute dollar terms to appreciate at least 10 percent over the next 6 months.
• Hold
  Stocks would continue to hold in portfolio, are expected to appreciate or depreciate in absolute dollar terms less than 10 percent over the next 6 months.
• Sell
  Stocks recommended for active selling, are expected to depreciate in absolute dollar terms at least 10 percent over the next 6 months.

Wachovia Securities

• Strong Buy
  Believe substantial/meaningful upside potential exists. Has high visibility on estimates and confidence in co.'s business model and management's execution abilities. A near-term catalyst should be able to drive stock higher. Buy aggressively.
• Buy
  Believes stock is attractively valued. Co. has sound or improving fundamentals that should allow it to outperform broader market. Buy.
• Hold
  Believes stock is fairly valued at current price. Co. may have issues affecting fundamentals that could take some time to resolve. Alternatively, fundamentals may be sound but this is fully reflected in stock price. Do not accumulate additional shares.
• Sell
  Believes stock is overpriced relative to soundness of co.'s fundamentals and long-term prospects. Co. has significantly weak fundamentals or flawed business model. Sell.

Wasserstein Perella

Wedbush Morgan

• Strong Buy
• Buy
• Long-Term Attractive
• Hold
• Sell

Wells Fargo Securities

• Buy
  Immediate purchase is recommended. Stock is expected to outperform the general market over next 12-18 months.
• Hold
  Holding the stock is recommended. Stock has moved out of preferred buying range, but there is further upside to share price or stated objectives at time of purchase have changed and share appreciation may take another 6-12 months.
• Sell
  Stock has reached stated price objective and appreciation has been achieved or certain company fundamentals have changed warranting investors sell the stock to avoid price decline.

Whale Securities

William Blair & Co.

• Outperform
  Expects stock to outperform the broader market over next 12 months.
• Market Perform
  Expects stock to perform approximately in line with the broader market over next 12 months.
• Underperform
  Expects stock to underperform broader market over next 12 months.

Williams Capital

• Strong Buy
  Reflects potential estimated total return of 20% within the next 12-18 months for a stock with average risk; 15% for a stock with low risk; and 35% for a stock with high risk.
• Buy
  Reflects potential estimated total return of 15% within the next 12-18 months for a stock with average risk; 10% for a stock with low risk; and 25% for a stock with high risk.
• Hold
  Reflects potential estimated return of 10% within the next 12-18 months for a stock with average risk; 5% for a stock with low risk; and 20% for a stock with high risk.
• Reduce
  Reflects potential estimated total return of 5% within the next 12-18 months for a stock with average risk; -10% for a stock with low risk; and 15% for a stock with high risk.
• Sell
  Reflects potential estimated total return of -10% within the next 12-18 months for a stock with average risk; -15 percent for a stock with low risk; and 10% for a stock with high risk.

Yorkton Securities

• Top Pick
• Buy
• Accumulate
• Hold
• Reduce
• Sell

Market data and information provided by Morningstar.

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MorphoSys AG Unsponsored ADR (MOR) could be a solid choice for investors given its recent upgrade to a Zacks Rank #1 (Strong Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.

A company's changing earnings picture is at the core of the Zacks rating. The system tracks the Zacks Consensus Estimate -- the consensus measure of EPS estimates from the sell-side analysts covering the stock -- for the current and following years.

The power of a changing earnings picture in determining near-term stock price movements makes the Zacks rating system highly useful for individual investors, since it can be difficult to make decisions based on rating upgrades by Wall Street analysts. These are mostly driven by subjective factors that are hard to see and measure in real time.

Therefore, the Zacks rating upgrade for MorphoSys AG Unsponsored ADR basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price.

Most Powerful Force Impacting Stock Prices

The change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. The influence of institutional investors has a partial contribution to this relationship, as these big professionals use earnings and earnings estimates to calculate the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their transaction of large amounts of shares then leads to price movement for the stock.

Fundamentally speaking, rising earnings estimates and the consequent rating upgrade for MorphoSys AG Unsponsored ADR imply an improvement in the company's underlying business. Investors should show their appreciation for this improving business trend by pushing the stock higher.

Harnessing the Power of Earnings Estimate Revisions

As empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, tracking such revisions for making an investment decision could be truly rewarding. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.

The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>>.

Earnings Estimate Revisions for MorphoSys AG Unsponsored ADR

For the fiscal year ending December 2021, this company is expected to earn -$1.70 per share, which is a change of -300% from the year-ago reported number.

Analysts have been steadily raising their estimates for MorphoSys AG Unsponsored ADR. Over the past three months, the Zacks Consensus Estimate for the company has increased 22.6%.

Bottom Line

Unlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of 'buy' and 'sell' ratings for its entire universe of more than 4000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a 'Strong Buy' rating and the next 15% get a 'Buy' rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.

You can learn more about the Zacks Rank here >>>

The upgrade of MorphoSys AG Unsponsored ADR to a Zacks Rank #1 positions it in the top 5% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.

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