The Average Broker Recommendation

The average broker recommendation is the sum of the opinions on Wall Street.

The average broker recommendation (ABR) is compiled by Zacks Investment Research and based on the recommendations of the Wall Street brokerage firms. The ratings range from one to five, with one being the lowest, and are different from the Zacks rank, although those are also calculated on a grade of one to five.

Recommendations

When a company releases an earnings statement, Wall Street analysts look at the numbers compared to earnings expectations and other factors. They then make recommendations for the benefit of their firm and its investors.

Ratings

Wall street analysts reports on companies are detailed and multifaceted but ultimately boil down to buy, sell or hold recommendations. For the purposes of an ABR, a one recommendation is a strong recommendation to sell, a three is a hold recommendation and a five is a strong buy recommendation.

Zacks Rank

The Zacks Rank is another rating published by Zacks; it is also rates stocks from one to five. The Zacks Rank is not the same as the ABR as it takes other factors into account such as the severity or speed of a change in ratings.

References

• Investing Online for Dummies By Matt Krantz p. 153
• Sci Docs: Glossary
• Seeking Alpha: Zacks Research
• Zacks: The Difference between Average Brokerage Recommendation (ABR) and the Zacks Rank

Resources

• Zacks Research