Morning Star Valuations

[lou]

Being a member of ASB securities I get access to the Mornings Star Recommendations and Valuations. I have some questions I would like to propose to the forum?

1) How useful are these recommendations?

2) Are the valuations accurate?

3) Does any one use them as part of there trading strategy? If so why? If not why?

4) Are the valuations are self for-filling prophecy? Ie buyers and sellers with imperfect information assume they must be correct as they will have more information and done more research on the company. The buyers and sellers will tend to that price until a new recommendation, valuation or information is available.

5) What other valuations or rating organizations do people use?

[percy]

I will try to answer your questions.
1] Very useful to help you understand the company.
2] valuations are accurate on historical information only as no one can predict the future.
3]No,as I try not to trade.
4] Yes to a degree.Most brokers would only like to recommend shares that they have research to back them up with .A lot of very good research around,but the market can change very quickly.ie ChCh earthquake made a huge difference to FBU outlook.
5]I try to read the company's annual report first of all.I then look at charts to see whether the company is in an uptrend or not.If there is something I do not understand I ring the company .I find reading the thread on sharetrader gives me a good feel for the company.Still not sure I will ask sharetrader members their view.Then if I want to go ahead I ring my broker.He may have further research,which he will send me.He may know reasons I should not go ahead. Often I like to take a small position,then if I feel I have made the correct investment I will add to my holding.I like going to AGMs and meeting directors and management.

[levin123]

They're all a bunch of monkeys. Don't be lazy, Always do your own research!

[HIDDENGEM]

Human beings are not free from judgement of errors.

Time to time almost all the market players can make mistakesin this financial world.

It is better to do your own study as well.

We can learn something from Morning star research.

Always have an idea about future earnings and future valuationsthan past earnings


Good luck