GEA Group (GEAGF) Upgraded to Strong Buy: What Does It Mean for the Stock?

24.06.24 18:00 Uhr

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GEA Group AG (GEAGF) appears an attractive pick, as it has been recently upgraded to a Zacks Rank #1 (Strong Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change.The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.The power of a changing earnings picture in determining near-term stock price movements makes the Zacks rating system highly useful for individual investors, since it can be difficult to make decisions based on rating upgrades by Wall Street analysts. These are mostly driven by subjective factors that are hard to see and measure in real time.As such, the Zacks rating upgrade for GEA Group is essentially a positive comment on its earnings outlook that could have a favorable impact on its stock price.Most Powerful Force Impacting Stock PricesThe change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. That's partly because of the influence of institutional investors that use earnings and earnings estimates for calculating the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their transaction of large amounts of shares then leads to price movement for the stock.For GEA Group, rising earnings estimates and the consequent rating upgrade fundamentally mean an improvement in the company's underlying business. And investors' appreciation of this improving business trend should push the stock higher.Harnessing the Power of Earnings Estimate RevisionsAs empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, tracking such revisions for making an investment decision could be truly rewarding. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>>.Earnings Estimate Revisions for GEA GroupThis company is expected to earn $2.72 per share for the fiscal year ending December 2024, which represents a year-over-year change of -1.8%.Analysts have been steadily raising their estimates for GEA Group. Over the past three months, the Zacks Consensus Estimate for the company has increased 6.1%.Bottom LineUnlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of 'buy' and 'sell' ratings for its entire universe of more than 4000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a 'Strong Buy' rating and the next 15% get a 'Buy' rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.You can learn more about the Zacks Rank here >>>The upgrade of GEA Group to a Zacks Rank #1 positions it in the top 5% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.Free Report: 5 “Whisper” Stocks Poised to Stun Wall Street Analysts may be seriously underestimating these stocks. When they announce earnings, they could immediately jump +10-20%.See Stocks Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GEA Group AG (GEAGF): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks

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Quelle: Zacks

Nachrichten zu GEA

Analysen zu GEA

DatumRatingAnalyst
12.07.2024GEA HaltenDZ BANK
11.07.2024GEA BuyDeutsche Bank AG
11.07.2024GEA UnderweightJP Morgan Chase & Co.
11.07.2024GEA BuyWarburg Research
10.07.2024GEA BuyJefferies & Company Inc.
DatumRatingAnalyst
11.07.2024GEA BuyDeutsche Bank AG
11.07.2024GEA BuyWarburg Research
10.07.2024GEA BuyJefferies & Company Inc.
10.07.2024GEA OutperformRBC Capital Markets
08.07.2024GEA OutperformRBC Capital Markets
DatumRatingAnalyst
12.07.2024GEA HaltenDZ BANK
08.05.2024GEA HoldJefferies & Company Inc.
17.04.2024GEA HoldJefferies & Company Inc.
11.03.2024GEA HaltenDZ BANK
07.03.2024GEA HoldJefferies & Company Inc.
DatumRatingAnalyst
11.07.2024GEA UnderweightJP Morgan Chase & Co.
10.07.2024GEA UnderweightJP Morgan Chase & Co.
09.07.2024GEA UnderweightJP Morgan Chase & Co.
13.05.2024GEA UnderweightJP Morgan Chase & Co.
08.05.2024GEA UnderweightJP Morgan Chase & Co.

Um die Übersicht zu verbessern, haben Sie die Möglichkeit, die Analysen für GEA nach folgenden Kriterien zu filtern.

Alle: Alle Empfehlungen

Buy: Kaufempfehlungen wie z.B. "kaufen" oder "buy"
Hold: Halten-Empfehlungen wie z.B. "halten" oder "neutral"
Sell: Verkaufsempfehlungn wie z.B. "verkaufen" oder "reduce"