recommendation

Definition

An opinion given by an analyst to his/her clients about whether a given stock is worth buying or not. Wall Street investment firms employ thousands of analysts whose job is to issue reports and recommendations on specific stocks. These analysts typically look at the company's fundamentals and then build financial models in order to project future trends, most notably future earnings. They then use these projections as a basis for issuing recommendations on whether or not they think the stock should be bought or sold. Each brokerage has its own terminology, which makes it difficult to compare recommendations between brokerages, but the most common ratings are (in descending order of quality) strong buy, buy, hold, and sell.

Use recommendation in a sentence

After in-depth analysis of the most recent quarter, the stock analyst made a recommendation to investors to sell their shares.

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stock picks strong sell