All 4 of Analysts’ Favorite Stocks Fell Last Year

The four stocks that Wall Street analysts most adored a year ago all fell.

The analysts’ darlings as of January 2019 posted a 15% loss from Jan. 14, 2019 through Jan. 10, 2020. This happened even as the Standard & Poor’s 500 Index, widely used as a gauge of the U.S. stock market, rose 26%.

What about the four stocks that analysts despised the most a year ago? They fell 9%, but that was a milder loss than the favorites experienced.

Abiomed Inc. (NASDAQ:ABMD) was the biggest disappointment among the analysts’ darlings, falling 40%. Viper Energy Partners LP (NASDAQ:VNOM) dropped 10%, while Marathon Petroleum Corp. (NYSE:MPC) and Camping World Holdings (NYSE:CWH) had single-digit losses.

Among the hated stocks, American States Water Co. (NYSE:AWR) posted a 31% gain. But World Acceptance Corp. (NASDAQ:WRLD), Franklin Resources Inc. (NYSE:BEN) and Tanger Factory Outlet Center (NYSE:SKT) had losses ranging from 18% to 27%.

Oops again

The analysts’ poor showing was not as strange as you might think. For two decades, I’ve been tracking the performance of the four U.S. stocks that Wall Street analysts love the most, and those they despise.

I’ve done this each January from 1998 to the present, with the exception of 2008, when I was temporarily retired as a columnist.

In 21 years, the analysts’ adored stocks have averaged an 8.85% return. The despised stocks averaged 6.78%. Both trailed far behind the S&P 500, at 11.74%.

The analysts’ darlings have trailed the S&P 500 14 times out of 21, and lost to the despised stocks nine times.

How can this be? Wall Street analysts are intelligent and hard-working. They have fast computers and good-looking assistants who recently graduated from Harvard or Yale.

The short answer is that human beings just can’t predict the future. Another answer lies in the

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