Globe and Mail data - Suncor- First stock buy ever! Opinions pls
Hi all- this is a mutli part question,
Not to long ago I posted about putting a portion of my bonus into an RBC direct investing registered account. I ended up doing so and until I felt comfortable buying stocks just held it in a money market fund (4 wks now
I have now spent some time reading various sites, news, etc. Of course there are so many companies I have looked at and though "gosh maybe I should buy some of their stock" havent and of course it has gone up (Dollarama). I feel like I am missing the bus. As part of my reading I discovered the Globe and Mail invesor section where it analyzes stocks and provides buying (or holding) opinions. One company I am looking at is Suncor. Currently the G&M lists this as a stong buy. I look at the history and thing 'looks good'. Who actually writes the recommendations to either buy or hold and do you think it is a reputable opinion (short of unforseen disasters). Also- what are your thoughts on Suncor? Would you buy? I have 10k to play with... Thanks, I am freaked out to buy my first ever stock. Not freaked out in the sense of losing money, just making the jump.
For your first dip in the stock market I would have suggested a more conservative play like a big 5 bank.
Oil companies are volatile and Oil Sands companies are more volatile than regular Oil companies. The problem is these guys are high marginal cost producers so they get killed on drops in the oil price. Actually, they get killed on the rumours of drops in the oil price.
Personally, I would have suggested starting with a Telco (i.e. BCE or RCI or Telus) or a bank (BNS, TD, RY) so you could start with some more stable dividend paying companies to first dip into the stock market.
Just beware Suncor will be volatile and do not sell when the price dips unless something fundamentally impairs the business. Temporarly now oil prices, poor investor sentiment and environmental protests by the Hollywood elite do not count. If you buy this one you hang onto your seats during corrections and do not let go. You buy this company when it is cheap and then you hold on. It will take 10 to 20 years for this company to reach its potential.
Jungle- thanks for the thread link. Just read through the entire 40+ pages. interesting indeed, Larry's got game (and a great return). I missed the 26$ buy, but cant cry over spilled milk.
Edmonton- I hear ya about buy when cheap and hold on. Personally I dont 'really' know my risk tolerance when it comes to stocks. In a wierd way am not too concerned about the risks associated with possible money loss. I am 34...I have lots of time and its a registered plan, so not touching this money any time soon. What about the ratings in G&M though? Do folks regularily use this to make decisions to buy/hold/sell etc?
In the meantime I will check out the Telco/Bank stocks you mentioned....more research.
oh dear !
another one !
these misconceptions are so common these days !
bomb the globe & mail isn't recommending anything, nor will any other reputable media ever recommend or advise against any stock selection. What globe is doing is reporting the consensus advice from the analysts for each stock. Globe itself has no opinion.
look again & you will clearly see that, in the case of suncor, globe reports that 10 analysts had a strong buy, up from slightly fewer like-minded analysts in prior periods.
in my experience, most of these "analyst" reports are dated by the time they arrive in tables like these. They are worth very little.
perhaps you could look, instead, at a fresh & customized opinion provided directly to your personal computer screen by cmf member pmredmonton. He thinks that, for a first stock pick, the energy sector is too volatile & out of favour at the present time. Totally agree. He suggests that, for a 1st stock pick, you might go with a big bank - pick your own bank, or pick a bank you like - or with a telco. Totally agree.
cyclical stocks like the big energies are more challenging, should come later.
For the most part I don't pay attention to those things as analyst sentiment is usually already baked into the stock price.
The thing I'll caution you about is very few stocks are listed as "sells". So you would think that when a stock is listed as a "sell" this means run for the hills. Conversely, stocks downgraded to sell actually have tended to outperform because they the time the stock analyst community has called something a sell it usually has just cratered on excessive negative sentiment.
Most stock will be rated somewhere between a buy and a hold.
Most stocks will be under the analyst target price by 10 to 20%.
Don't get too excited by these things.
My advice is to start with something conservative, that is consistently profitable and whose stock price does not fluctuate a great deal.
poor bomb, we are dropping too much on her first-time plate but she sounds like a bright lady, so we will assume she can handle it.
" Conversely, stocks downgraded to sell actually have tended to outperform because they the time the stock analyst community has called something a sell it usually has just cratered on excessive negative sentiment."
never a truer word. The fact is, analysts are super-salespeople who deal with institutional investors only. It is to these clients that their best, fastest & most timely research goes, so that they - the institutions - can act first.
later, the analysts wearily crank out versions of their opinions for the masses, which get disseminated through the network of retail stockbrokers.
by the time the buy/sell opinions get to reprint tables like the globe & mail, the views set forth are a couple of months old.
on countless occasions i've seen analysts publicly recommending "sell" exactly the day before a stock troughed & commenced a magnificent upward climb. Just like lou schizas in the globe & mail yesterday, who advised readers to sell africa oil at its short-term trough of 3.50, whereas stock promptly recovered to $4.00 today.
humble_pie. Thanks for what I will accept as a compliment! This is good info. I have mentioned it in a post a while ago, I have been trolling the CMF for a while now and appreciate the feedback here. Helps much more than any other place I have been. At times I think I am in over my head...but I keep reading anyways. Eventually it will sink in.
welcome to a fascinating chaos in which everything is linked to news, people, geopolitics, reality sometimes not even yet known. OK maybe spreadsheets are useful as well. But they don't tell the whole story.