Why do price targets released by finance institutions on stocks matter?
In: Economics
Typically the folks who work for banks’ research arms also have direct contacts with management and more insight into the company than your average person.
I think that the notion that people react to the price targets changing is a bit misleading though – I think people react to the new research, which typically comes with a whole host of revised assumptions and projections. The price target is just a single data point in a whole suite that gets released at once
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