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As challenging market conditions make it difficult for stock picking, the consensus view of the analysts about a stock is an indicator that investors may need to watch closely.
Morgan Stanley says investors with a 12-month view need to assess how bullish or bearish the sell-side (brokers) is apart from the usual fundamental debates.
For instance, if the sell side is more bullish, the likelihood of the stock performing is less, according to the investor bank.
Similarly, the level of institutional ownership and earnings expectations can be other key indicators: higher ownership could limit stock gains and if earnings growth expectations fall too low, they could well become a support for shares, said Morgan Stanley.
Based on the recent changes in institutional ownership, change in ownership, sell-side ratings, change in ratings, earnings revisions, trailing performance and change in relative valuations, it appears that ITC, ONGC, Maruti, NTPC and Lupin and are the stocks where the consensus is most bullish, said Morgan Stanley.
Tata Steel, L&T, BHEL, NMDC, and Punjab National Bank are the stocks where the consensus is most bearish, it said.
