Banks Price Targets

[Gorilla]

I see multiple reports of banks saying that they haave raised their price target for a stock to a certain price which is much higher than the current price.

Why do they do this?
Why doesnt the stock jump when they make these.
Shouldnt everyone believe the banks when they make these statement?

[sputnik]

[Strider]

Gonna have to pull this quote from the other thread:

Originally posted by cjblair
You should probably think twice about investing at all if that's how you do math.

[Gorilla]

honest question.

[BrknFngrs]

While analysts generate their reports on companies professionally, they reflect the beliefs, expectations and estimates of the individual analysts. While the public information used in their analysis will be largely the same, the other noted factors can vary investor to investor and institution to institution resulting in a wide variety of valuations being seen as reasonable.

You'll often see various institutions and analysts release reports on the same stock but their buy/sell/hold recommendations and price targets can vary wildly.

[ExtraSlow]

It's also interesting to note that professional analysts and the companies that they work for generate funds from a variety of sources, one of which is subscription fees from the very companies that they are rating.

[ercchry]

I'd say the majority of money in the markets is controlled by institutions... who would have their own analysts, there for there is not much movement from the few individuals that are actively following individual securities when the banks release their predictions