In 2012, Apple Inc. (AAPL) saw countless upgrades when the stock was trading at $700 a share. The stock never went higher and has since collapsed as low as $387 before stabilizing in the $500 range. That shameful action by analysts should be a learning experience for all investors. The lesson? Always be skeptical of upgrades at all-time highs or downgrades at all-time lows. Most analysts are no better than an average investor and often times can have ulterior motives.
What's It Mean?
History appears to be repeating itself again. Facebook Inc. (FB) has seen multiple upgrades in recent weeks including Monday, when UBS upgraded the stock to a $90 price target. Sound familiar? In 2012 -- when Apple was trading at $700 -- it saw upgrades to $1000 price targets and beyond.
Be aware of this as it may be telling us of a long-term top on the stock.
Gareth Soloway
Chief Market Strategist
www.InTheMoneyStocks.com