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Discussion Starter #1
Does anyone know of a good online source for finding out the average 1 year price target for TSX stocks?
What I want to do is see a list of the TSX60 comparing their current price with their average 1 year target set by analysts and rank them by their highest upside potential.

For example I know Yahoo finance gives 1 year price targets for US stocks for your watchlist or portfolio, which is super handy, but this data doesn't work for TSX stocks.

If such a list doesn't exist online, I know it's possible to research each one by one. If I compile a list one by one would anyone else find this useful?
 

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not really ... any idiot can make up a price target
what i would like is to see some solid research that demonstrates that analysts price targets are actually, you know, on target
 

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Many discount brokerages allow you to check Thomson Reuters reports where you can see price targets of practically all stock on TSX and NYSE (CIBC IE and TWD for sure). They give High/Low/Median target price... Also I think Yahoo fifnace give you then number
 

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Lots of investors look to analysts to provide them with guidance to the future direction of the stock price.
The idea being that if the stock is far away from the analyst price target, then that stock is a good stock to buy because there is so much potential upside.

However, I did some research on this, a number of years ago. What I found was that, the opposite was true. The conclusion that I found was that....

Stocks with a higher ratio of Target Price / Current Price would perform worse (1 year later), than stocks that have a lower ratio.
 

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Discussion Starter #6 (Edited)
about price targets

I'm mainly curious about the TSX60 stocks relative to the price targets, and if you're curious I'll put together a list and share it below.

Do back up your opinions about price targets with facts or research, and share what screening strategies work best and why. Of course there is nothing in the world of investments thats going to give you a 100% win probability 100% of the time. I could pick all perfect companies and the market may tank. Of course nobody knows for sure how high or low a stock will go in the next year! Yes, your investing time horizon of when you're buying and selling matters. Some people say you can / can't time the market. As always doing your homework, portfolio position management, diversification and all the other best practices are important too.

IMHO price targets are useful info because if you take the average target set by professional analysts, you're closer to having a picture of what might happen. I'd take professional advice over 'some idiot' on these forums any day (like any of us have a better idea or 100% accurate foreknowledge of what any stock will do over the next year??) These pros have a much better idea of the company and study more data about it than I ever will. They do it for a living, are qualified CFAs, are education in this field etc. Yes the analysts disagree and some rate a stock 'buy' and others 'hold', with different price targets. It takes all types to make a market. But taking the average of 22 analysts is worth something to me. I want more info, and more analyst coverage to get a better idea of how a company is doing. A small cap company with analyst coverage is far more volatile and speculative investment than a large cap TSX60 blue chip company closely followed by 40 analysts!

I'm a firm believer of using a combination of fundamentals along with technical data to determine what to invest in, when to buy or sell and so on. If the pros say on average it's a buy or a hold, or that it's already at it's 1 year target... I'm going to use that info along with valuation metrics like PE ratios, charts, indicators and so on. It's useful to compare stocks, rank them, screen them and so on. Its all that kind of stuff which will inform you and give you confidence in your investment decisions.

Sites I've found after some digging:
http://markets.ft.com/research/Markets/Tearsheets/Forecasts?s=TD:TOR <--this is the better of the two
http://quotes.wsj.com/CA/XTSE/bmo/research-ratings


Disclaimer: As always do you own homework, fact check, consult your personal professional financial adviser etc etc.


PS: A month ago I ended my 6 year investment in Potash which is at the bottom of the list. I also bought BNS yesterday... again at the bottom of the list... But notice CFP is at the top... now suddenly that stock has got my interest where it didn't before, so I'll do some more research on it.


@fatcat I hear ya. Investing is more of an art than science. Backtests help, but like price targets, there's no guarantee of anything.
@gibor Agreed! I often use those T.R. reports, they're very good.
@GoldStone I'll read that article thanks!
@avrex can you share that research? Sounds interesting.
 

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For example I know Yahoo finance gives 1 year price targets for US stocks for your watchlist or portfolio, which is super handy, but this data doesn't work for TSX stocks. If such a list doesn't exist online, I know it's possible to research each one by one.
Yes, Yahoo Finance is limited when it comes to Canadian stocks. In the past I would use the interlisted ticker to obtain the Canadian stock's price target. However, that would mean I could only obtain information for approx 40 of the TSX60 stocks.

A good source for Canadian stock info is Globe Investor - My Watchlist.
You can create a list of the S&P/TSX60, for example, and perform analysis on those stocks.

I have done that for you below.

TSX60-Analyst-Recommendations-Price-Target
 

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Discussion Starter #11 (Edited)
@avrex Thanks for the list! I often used the old version of globe investor to screen stocks years ago but lost interest when the updated it. I just went back in and the new watch list is excellent for screening lists of TSX stocks and comparing data in tables.


-----

Here's a Dividend growth stock screen I just ran that looks promising. The 15 picks are ranked by % to target (and are 8% from target on average)

TSX stocks with market cap over 2B,
>10% EPS growth estimated this year,
Positive EPS under 50,
Dividend yield over 1% that has grown 10% on average over the past 5 years.

The top 10 screen picks are rebalanced every three months. The backtest shows that the total return of this strategy has outperformed the TSX by 10%+ on an annual basis over the past 5 years.


https://docs.google.com/spreadsheets/d/18nWsBm6pNLJe6agaM72LM51DzZI0lH1YXeH6e20OLoI/pubhtml


Disclaimer: As always do you own homework, fact check, consult your personal professional financial adviser etc etc.
 

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i like #3
They are designed to generate trading and commission fees for brokerages

We do not know which analyst first decided long ago to slap a target price on a stock. But we can imagine that brokerage’s executives rubbing their hands with glee when the stock in question reached its target and clients started to sell.

Of course, selling one stock typically results in buying another, so a hit target can generate two selling commissions for a broker. Bonus time!
and guess what ? .. it works .. at least on me (at some level at least some of the time) .. i see that "price target" and i think "oh some smarter guy than me thinks this is going to $107 and it's at $98 now that's good, my money is going to be well spent"

there is a major brokerage in canada that sells its price targeting as it's lead and best service, they claim to have some fantastic formula, i forget the name though
 

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Yes, Yahoo Finance is limited when it comes to Canadian stocks. In the past I would use the interlisted ticker to obtain the Canadian stock's price target. However, that would mean I could only obtain information for approx 40 of the TSX60 stocks.

A good source for Canadian stock info is Globe Investor - My Watchlist.
You can create a list of the S&P/TSX60, for example, and perform analysis on those stocks.

I have done that for you below.

TSX60-Analyst-Recommendations-Price-Target
BBD.B is number 2 :)
 

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Discussion Starter #14 (Edited)
@ fatcat
Based on what you've said, regarding "They are designed to generate trading and commission fees for brokerages"
Essentially you advocate buy and hold then? Is it your point of view that investors can't improve portfolio performance by stock picking and trying to time the market?
Many investors have a different point of view that you can outperform the market by picking the right stock and buying and selling at the right time. Stock screening is a good strategy for this.

A good example of this last month was that many stocks I own I should have sold before they fell 10%.
I could have then bought them back again a few days later 10% cheaper and held them again. Buy and holding a bunch of winning and losing stocks for years at a time will result in average market returns (in my opinion). I think regular portfolio rotation among stock picks seems to give the better results from what I see through backtesting and my personal experience. It gives me a chance to apply tax loss selling every year against the gains as well.

@ gibor I'm guessing from the smiley it means you hold BBD.d?
 

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For those that want to create a similar list that can contain many stock metrics, perform that following:

1. Go to Globe Investor - Watchlist

2. Select Create new watchlist

3. Give it a name. In this example, S&P/TSX60.

4. In the 'Add Item' field, copy and paste the following string (which contains the 60 ticker symbols of the TSX60):

ABX-T,AEM-T,AGU-T,ARX-T,BAM.A-T,BB-T,BBD.B-T,BCE-T,BMO-T,BNS-T,CCO-T,CCT-T,CM-T,CNQ-T,CNR-T,COS-T,CP-T,CPG-T,CTC.A-T,CVE-T,ECA-T,ELD-T,ENB-T,ERF-T,FM-T,FTS-T,G-T,GIB.A-T,GIL-T,HSE-T,IMO-T,K-T,L-T,MFC-T,MG-T,MRU-T,NA-T,POT-T,POW-T,PPL-T,PWT-T,RCI.B-T,RY-T,SAP-T,SJR.B-T,SLF-T,SLW-T,SNC-T,SU-T,T-T,TA-T,TCK.B-T,TD-T,THI-T,TLM-T,TRI-T,TRP-T,VRX-T,WN-T,YRI-T

5. Select Add To Watchlist.

6. Done. Now you can look at tons of metrics for these Canadian stocks.
You can even export the data to a spreadsheet for further analysis.
 

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@ fatcat
Based on what you've said, regarding "They are designed to generate trading and commission fees for brokerages"
Essentially you advocate buy and hold then? Is it your point of view that investors can't improve portfolio performance by stock picking and trying to time the market?
i think that buying and holding excellent companies for the long term OR buying index funds for the long term is the best way to make money in the stock market ... over the long term

i think that stock pickers can do well over short periods of time but since pure stock picking (as distinct from buying and holding long term) is effectively predicting the future (the number of variables that affect a stocks prices are technically probably limited but practically infinite) and nobody does that well ... you will have winners and you will have losers ... 95% of people who say they are beating the market over the long term are just keeping lousy records (they are ignoring or under-factoring their losers)... as i say, the short term is different

others will now disagree :biggrin:
 

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i think that buying and holding excellent companies for the long term OR buying index funds for the long term is the best way to make money in the stock market ... over the long term

i think that stock pickers can do well over short periods of time but since pure stock picking (as distinct from buying and holding long term) is effectively predicting the future (the number of variables that affect a stocks prices are technically probably limited but practically infinite) and nobody does that well ... you will have winners and you will have losers ... 95% of people who say they are beating the market over the long term are just keeping lousy records (they are ignoring or under-factoring their losers)... as i say, the short term is different

others will now disagree :biggrin:
I'm watching BNN Market Calls every day, and at least once a week an analyst would say in not so many words that it's a stock picker's marker now. Here's the latest, Jennifer Radman for example:

MARKET OUTLOOK:

We remain positive on stocks but recommend a selective approach versus blindly buying the market through ETFs. Valuations or the prices investors must pay to own stocks have moved higher with the market over the last several years. While we do not believe valuations have moved high enough to warrant reducing stock market exposure, it does mean that investors should expect lower returns going forward. Also, success will be determined by being in the right stocks. The key, we believe, is having a process that identifies opportunities on a company-specific level.


So you think it's because they have an ulterior motive? :)
 

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Discussion Starter #18
The thought occurred to me that the TSX 60 is a really limited benchmark index designed to represent 10 different sectors. It is comprised of large companies selected by the S&P ( and why one company is selected or omitted by S&P is not clear). It is not the 60 largest companies on the TSX. So for a wider list of the top quality companies to choose from for picking investments I did some more screening. We hope to find the better stocks which will outperform the market as a whole, and will be in demand going forward driving the price upward relative to the market.

Currently there are: around 1000 common shares that trade on the TSX.
260 common share stocks on the TSX of companies with a 1 Billion market cap or larger.
193 and with a price $1 or higher which trade 50,000 or more shares daily for the past 90 days on average (safe liquidity).

Backtests run on TD's screener show that screening so no stocks have a Consensus Rating Average of "sell" has given a 3x greater return (18% annual average) than holding the TSX 60 index (6%). Seems like a good basic requirement to have for picking an investment!



@avrex those steps are helpful, thanks. I'll be sure to register there.
 

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I'm watching BNN Market Calls every day, and at least once a week an analyst would say in not so many words that it's a stock picker's marker now. Here's the latest, Jennifer Radman for example:

MARKET OUTLOOK:

We remain positive on stocks but recommend a selective approach versus blindly buying the market through ETFs. Valuations or the prices investors must pay to own stocks have moved higher with the market over the last several years. While we do not believe valuations have moved high enough to warrant reducing stock market exposure, it does mean that investors should expect lower returns going forward. Also, success will be determined by being in the right stocks. The key, we believe, is having a process that identifies opportunities on a company-specific level.


So you think it's because they have an ulterior motive? :)
no, I don't necessarily think they have an ulterior motive ... and it may well a stock pickers market but the question remains, which stocks do you pick ?

the question is not what you pick now or next year but what your portfolio looks like in a decade or 2 decades, that's what matters

nobody has "a process that identifies opportunities on a company-specific level" with a guarantee of accuracy ... they all say they do but they don't ...
 

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Discussion Starter #20 (Edited)
... which stocks do you pick ?

the question is not what you pick now or next year but what your portfolio looks like in a decade or 2 decades, that's what matters

nobody has "a process that identifies opportunities on a company-specific level" with a guarantee of accuracy ... they all say they do but they don't ...

What stocks to pick:
Screening for companies with the best fundamentals. I try to think of it as my mission to find the real gems among all the other junky or mediocre companies. There are valuation metrics that can be used to determine if a company is a fair value. Companies do this all the time for M & A. Look at the success of Warren Buffet and his Berkshire Hathaway and his value investing approach. Then from there consider technicals whether to buy now or later at a more favourable place in the chart. It's very likely that companies with good fundamentals can drop in price a good bit simply because of the chart technicals. Everyone trades the same chart, so it happens when most people don't like the looks of the chart!

What I think my portfolio will look like for the next decade is constant change. I believe I get better performance by moving out of poorly rated companies with bad fundamentals instead of holding on to the tanking pigs, hoping they'll turn around enough so I can break even (like Potash for the past 7 years).
Yes, it will cost me comissions for each transaction, but what's $20 compared to losing $1000 on a poorly performing investment?

You should check out the research on mechanical investing using stock screens that (noninstitional) investors have done. There's been quite a bit of research done on the US market thats been openly shared. For example on Motley Fool forums, backtest.org, tradesim.info, Keelix or the AAII. There's a bit of a learning curve at first, but some stock screens have really withstanded the test of time over the past 20 years in good and bad times. This research shows that some approaches have much lower volatility and risk, while far outperforming the index.
 
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