What it is
An analyst rating is an assessment published by a financial analyst, typically working for an investment bank or research firm, regarding the future performance of a company's stock. These ratings are based on extensive research, financial modeling, and interviews with company management and industry experts. Common ratings include "Buy," "Hold," "Sell," or variations like "Overweight," "Underweight," or "Market Perform," indicating the analyst's conviction about the stock relative to its industry or market.
Analyst ratings frequently influence market sentiment and stock prices, especially around earnings season or significant company news. When an analyst upgrades or downgrades a stock, it can trigger immediate price movements as investors react to the perceived change in fundamental outlook. Retail investors often track these ratings to gauge expert opinion, but it's crucial to understand that analysts can have biases or be wrong, and their ratings are just one data point among many.
Why it matters
Analyst ratings offer a professional opinion on a stock's prospects, influencing market perception and potentially affecting its price. Use them as a starting point, not the sole basis for decisions.
Reviewed under editorial standardsUpdated September 26, 2026Not investment advice