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Star sell-side analysts listed by Institutional Investor, The Wall Street Journal and StarMine. Whose recommendations are most profitable?

Author

Listed:
  • Kucheev, Yury O.

    (Technical University of Madrid (UPM), Madrid, Spain,Royal Institute of Technology (KTH), Stockholm, Sweden, Swedish House of Finance, Stockholm School of Economics.)

  • Ruiz, Felipe

    (Department of Industrial Management, Business Administration and Statistics, School of Industrial Engineering, Technical University of Madrid (UPM))

  • Sorensson, Tomas

    (Department of Industrial Economics and Management, School of Industrial Engineering and Management, Royal Institute of Technology (KTH), Swedish House of Finance, and Stockholm School of Economics.)

Abstract

In this study, we compare the profitability of the investment recommendations of analysts listed in four different star rankings: Institutional Investor magazine, StarMine’s “Top Earnings Estimators” and “Top Stock Pickers” and The Wall Street Journal. We document that the highest average monthly abnormal return of holding a long-short portfolio, 1.58 percent, is obtained by following the recommendations of the group of star sell-side analysts rated by The Wall Street Journal during the period from 2003-2013. The results indicate that the choice of analyst ranking is economically important in making investment decisions.

Suggested Citation

  • Kucheev, Yury O. & Ruiz, Felipe & Sorensson, Tomas, 2015. "Star sell-side analysts listed by Institutional Investor, The Wall Street Journal and StarMine. Whose recommendations are most profitable?," INDEK Working Paper Series 2015/11, Royal Institute of Technology, Department of Industrial Economics and Management.
    • Handle: RePEc:hhs:kthind:2015_011
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Star analysts; Analyst recommendations; StarMine; Institutional Investor; The Wall Street Journal;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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