Analyst Rating
A Wall Street analyst's recommendation on a stock — typically Buy, Hold, or Sell — based on their research.
What is Analyst Rating?
An analyst rating is a formal recommendation issued by a securities analyst — typically at a brokerage, investment bank, or independent research firm — on whether investors should buy, hold, or sell a particular stock. Common rating labels include Buy (or Outperform/Overweight), Hold (or Neutral/Market Perform), and Sell (or Underperform/Underweight). Ratings are accompanied by a price target — the analyst's 12-month expected stock price — and a detailed research report justifying the recommendation. Upgrades (moving from Hold to Buy) and downgrades (moving from Buy to Hold or Sell) can move stock prices significantly when published. Academic research has found that analyst recommendations have modest short-term predictive value but are frequently biased toward positive ratings due to investment banking relationships.
Example
In January 2024, multiple Wall Street analysts upgraded Nvidia from Hold to Buy after AI chip demand surged. Each upgrade typically triggered a stock price increase of 1–3% on the day of the report, as institutional investors followed the research. Nvidia's consensus analyst rating remained 'Strong Buy' throughout 2024 with average price targets rising from $600 to over $1,000.