Sell-Side Research Ratings Surge 240% since Beginning of 2020


According to data provided by Invisage, a UK-based investment research performance tracker, sell-side research ratings have surged almost 240% since the beginning of 2020 as research analysts scramble to reassess the value of the stocks they cover in the wake of the COVID-19 sparked market meltdown.

Sell-Side Ratings Surge

Based on the research ratings collected by Invisage from approximately 150 investment banks and independent research firms, BUY / HOLD / SELL recommendations have risen 238% from the first week of 2020 when the 4 week moving average for ratings hit 239 to an average of 809 ratings per week in the third week of March 2020.  

During the third week of March, 2020 51.1% of all the research ratings collected were comprised of BUY recommendations, 40.3% of all ratings were Neutral or HOLD ratings; and, 8.6% were SELL ratings.  This compares to 52.6% BUY recommendations; 39.3% HOLD ratings; and, 8.1% SELL ratings in the first week of the year.

As you can see from the chart above providing a view of weekly sell-side research ratings from January 2017 to the present, research ratings are seasonal, with ratings falling off sharply every year in the last two weeks of December.  However, what is particularly interesting is the fact that sell-side BUY/HOLD/SELL ratings have actually trended consistently higher since the beginning of 2019.   Over this period, the 4 week moving average for research ratings have risen 387%.

Our Take

The surge in sell-side research ratings during 2020 is understandable as research analysts have been forced to reevaluate their target prices and the relative value of their stocks under coverage in the midst of the recent COVID-19 sparked market meltdown.

It is also clear that in the 4th quarter of 2017 and throughout 2018, ratings spiked every quarter post earnings as analysts reevaluated their stocks under coverage for management guidance and earnings reports. 

However, none of these explanations addresses the obvious uptrend in sell-side research ratings that took place throughout 2019.  We suspect that the uptrend in sell-side ratings is in direct response to the surge in the stock market seen during 2019 when the market averages continuously set new highs.  This rally forced sell-side research analysts to consistently reset the target prices of their stocks under coverage throughout the year.

It is interesting to note that since the beginning of 2017, sell-side research analysts have not become any less optimistic as reflected by their stock ratings.  In January 2017, the percentage of SELL to total recommendations was 8.6%.  This ratio rose to 10.5% in January 2018, but then fell back down to 8.5% in January of 2019, remained at 8.6% in January of 2020, and hovers at 8.1% currently.  This relatively consistent trend reflects sell-side analysts’ historic reticence to issue a SELL rating on stocks.   

About Invisage

Founded in 2016, Invisage is a UK based research analytics platform that extracts actionable trade ideas from sell-side research across various asset classes (equities, fixed-income, macro, etc.) and calculates the performance of those research ratings.  The firm also connects research generated macro themes with bottom-up fundamental research to help investors understand the impact of such macro themes on their portfolio holdings, and they build active thematic baskets leveraging the sell-side’s research insights.


About Author

Mike Mayhew is one of the leading experts on the investment research industry. In addition to founding Integrity Research, Mike is on the board of directors of Investorside Research Association, the non-profit trade association for the independent research industry, and a frequent speaker on research industry trends and developments. Mike has over thirty years of research industry experience. Email:

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