Today’s Chart of the Day was shared on Twitter by Chris Verrone of Strategas Research (@verrone_chris). Chris highlights another historical extreme; 61% of stocks in the S&P 500 are trading above their average analyst price target. He notes, “The bottom-up analysts tend to be late near market lows.” Readings over ~37% from this indicator are rare and have only occurred twice in the past two decades - 2003 & 2009. Both instances occurred a few months after a major secular low. If stocks continue to trade above expectations, it wouldn't be surprising to see analysts ratchet up their price targets in an attempt to save face. A flurry of analyst upgrades would be yet another bullish tailwind for stocks over time.
Chart of the Day - Tuesday, June 9th, 2020
June 9, 2020
